So for everyone whoās been keeping an eye on the markets recently, thereās been bit of a dip across everywhere. During this time, Iām wondering what resources and references have you guys found insightful?
I read this blog post from MyWallSt and found the advice useful. Iām taking a look at my holdings and if the nothing has changed with the fundamentals Iām thinking about lowering my dollar cost average.
Looking forward to seeing what you all have to share
Same here , buying the dip SPUS < 30 , you got to love that, buy the dip , pray the tahajud ultimate plan
Salaam,
Hahaha, loved this, brother Osama! Buy the dip and pray Tahajjud 
Here are some things Iāve found useful
First of all, sit tight and donāt touch my investments (e.g. Intuitive Surgical, Abiomed, Nvidia, Uber, Salesforce) because I know theyāre inherently strong stocks that will bounce back
Follow the Motley Fool Money podcast to spot bargains and buy they ASAP
I find Brian Feroldiās Twitter posts on investing very insightful
Would love to know othersā thoughts on this as well 
The market trend has historically been upwards, so I believe itās best not to be bearish and instead hold steady or buy.
My approach has been to rebalance between sukuk and equities as the market goes down. I wonāt accept a guaranteed loss of 6%+ a year of keeping anything significant in cash.
If you are doing regular investing (DCA), if anything you should increase it while the market is going down or otherwise leave as is, assuming you are secured in your near term (saved well, rainy day fund, etc). If you didnāt save enough and therefore need to hold back investing in a downturn, thatās okayā¦ better than selling. But aim to be in a position in the future where if things went down you could keep buying the same or better yet buy more by rebalancing out of sukuk/cash savings. Thatās my thoughts anyway.
I was already around 1/3 into commodity stocks coming into this dip so just exiting a little more from normal stocks and redeploying partially into commodities, and then looking into REITS and possibly gold. i.e. making sure Iām diversified and following some macro themes.
Jazakullah , im in nvidia its gone from 220 to 240 love the stock
Wa Iyakum brother. Indeed. Nvidia looks like a killer investment, InshAllah
You can also take a look at these other stocks that are on my radar. See if any of them take your fancy.
Warm regards
Assalam o Alaikum Brothers,
We all hear and hearing more recently about the Market going down sometime in coming months. No one can point when and how much but this aspect also serves all of us to review our investments.
Can you advise the the sectors or halal companies/funds where we can diversify or hedge onto so that we have coverage against any downturn and avoid any losses from being over invested in popular sectors ( for e.g. tech or EVs and similar).
I feel avoiding losses is as important as striving for profits.
JAK
Cash is the only hedge, other than very specific investing strategies that work in bear markets where you need specific expertise and experience.
Normally one could hold bonds and hope they would offset a stocks downturn, but unfortunately the economic regime is different now and that hedge may not work.
Youāre probably thinking ābut what about inflationā, my money will be devalued. Yes thatās right, but if stocks are doing down then at least cash doesnāt go down. Iāve been 35%+ cash for several months now, and nearly 50% cash now.
The way I think about investing this year is to target smaller gains than in a normal year and just accept it.
You canāt reliably avoid losses as you probably know. You will lose to inflation if nothing else. The point is to make the gains exceed the losses over the long term. You donāt need anything but time and patience to all but guarantee it.
Aoa,
I see your point on Cash and seems to be better balance for the current environment. Besides the companies Br Kashif has mentioned with zero debt, are there other companies that you have looked and can recommend to invest.
In US lot of Islamic Mutual Funds are tech heavy, what are your thoughts on following the companies from those funds?
Ws, personally I am not recommending any companies.
However I do have a thread here which shares what Iām investing inā¦so feel free to follow it and get notificationsā¦it is +20% so far this year and since start of 2021 it is +75%. Feel free to look at those for inspiration and ask questions about them as potential investments. And please note the cash allocation Iāve been and still am holding, i.e. itās pretty high.
Regarding tech, I have zero track record in successfully making money in the big tech stocks, so I donāt invest in them. Tech has itās pros and cons. On the pro side, some are great companies. On the con side, if interest rates rise even a little, then in isolation logically this will push the prices of the big tech stocks down as people will move money into bonds. Like I sayā¦I donāt know!
I personally just use the Islamic funds, because I donāt think I can do a better job.
I disagree with keeping a large portion of cash because the market has been trending down, market sentiment, news, etc. Historically the peak time people hoarded cash was near market bottoms, and vice versa.
The issue is if you succeeded in market timing you can never be sure if it is because of some clever insight you have or if it is blind luck (we donāt call it luck but call it naseeb). So someone could be blinded to think they can outsmart the market only to be burned by it when they take even bigger market timing gambles and it doesnāt work out, wiping out any advantage they built up till then.
As for cash not going down, actually we need to fix this perspective and see that it is going down with inflation. If we saw it this way we would be less inclined to overdo keeping cash vs keeping money invested and hanging on for the roller coaster ride.
Who foresaw Covid would happen the year it happened, or that Russia would do what it did this year? And who knew that Covid wasnāt going to kill 10x more people and get much worse such that the market wouldnāt have fallen well below the Mar 2020 low instead of recovering so quickly and strongly? I know some people who cashed out then, some completely and others partially. Their cash is now worth 15%+ less and theyāre still waiting for the āright timeā to get back in.
Here is a list of assets that should do well during a bear market (or at least not correlate with stocks) according to conventional wisdom, and their respective YTD performance.
Gold: -8%
TIPS bonds: -14%
AGG bonds: -13%
TLT 20 Plus Year Treasury Bond: -25%
VNQ REITS: -22%
Bitcoin: -58%
Diversify they saidā¦itās the only free lunch they said. Buy non-correlating assets they said. Look at the performance over the past 30 years they saidā¦look at all these models and graphs weāve got they said.
And the ticker of the winner YTD isā¦drum rollā¦CASH!
Salam, if you are short term trading, then yes 30 year performance is irrelevant. For a person who cares about 30 year performance, YTD is completely irrelevant. Even 5 years is pretty irrelevant.
Iām making a a different point. Iāve been saying for months that 60:40 stocks:bonds (i.e. conventional wisdom) wont work at the moment and so Iāve been advocating a high cash allocation. Which Iāve reflected in my smallcap picks thread in real time.
The YTD data is important here as it proves me right or wrong, in real time. Not after the event. So far the jury is outā¦weāll see as we go along.
And this isnāt about me being right or wrongā¦am just concerned and so sharing info and the original poster asked āwhat are you doing when the market dips?ā. If people agree great, if not great.
Hey Farhan, great question. I have subscribed to plenty of substacks that offer great insight into Macro and the markets.
Some of my favourites would be MacroAlf, The Morning Hark, and FXMacroGuy
There are twitter users who specifically talk about various commodities. Some great follows in each sector:
oil - Anas Al Hajji, Eric Nutall
Uranium - UraniumInsider, John Quakes
Tin - PamplonaTrader, Respeculator
Fertilizer - Josh Linville
Coal - Matt Werder