No. of Recommendations: 0
5min ago:
- A´s unchanged, B´s down -0.9%.
- S&P/Nasdaq down -5%.
1% difference between A and B! That's extremely unusual. I wanted to write this:
"My interpretation: Big shareholders - the longterm ones and Funds - simply keep holding, while the casual owners are in moderation doing what the market does. Other interpretations?"
But only 5min later now A´s and B´s are both down -0.9%! Interpretations?
One thing is clear: We are living in interesting times.
No. of Recommendations: 0
And now, after having posted this, the difference again is nearly 1%. What have our enlightened posters to say about those extremes?
No. of Recommendations: 12
1% difference between A and B!
The A:B ratio is actually under 1500 at the moment. (midpoint of bid/ask versus midpoint of bid/ask)
This is pretty odd. Usually in panicky situations the B shares are the weak hands and sell off more and the ratio goes well above 1500.
But since Berkshire is seen as a flight to safety by those same weak hands, the B shares are holding up. It's not "panic" yet.
Sometimes (just sometimes) a bear market happens in two phases. First, the "risk off" shift from risky assets to resilient ones. Utilities are doing well today, consumer defensive, and healthcare. Later, as the bear continues and the margin call start rolling in, people start selling whatever they can rather than what they'd prefer. I'm not saying that's what will happen next, but it's certainly possible.
Jim
