Warren Buffett is well over 90 years old and advocates a 90% equities stance. Now that's easy for him to say but if you're a follower, follow. FWIW I own my share of BRK.B but sold way too much a while back. I've lost way more money by selling when I shouldn't than I ever have by buying a bad stock.
I sold every stock I own but one and went to cash
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Last: 24 days ago by Mr.Milkshake
I am considering paring back in the erisa accounts
But the tax liability makes selling the non retirement accounts hard
But the tax liability makes selling the non retirement accounts hard
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I hope you're a troll. If not, my condolences.
OP may have made the right move
OP's going to need a much greater selloff than 5% to prove himself right.
It's coming...txaggie_08 said:
OP's going to need a much greater selloff than 5% to prove himself right.
Ghost of Bisbee said:
OP may have made the right move
The 'right move' doing what OP did is actually 2 'right moves' not one.
There really is nothing wrong with taking profit off the table.
Sure you may miss out on the next jump but so what, if it helps you sleep at night.
As long as you are disciplined and have a strategy that you are willing to stick to, you will be fine.
some people jump in and out based on the moving averages of the S&P 500...is that a better strategy than buy and hold and keep dollar cost averaging no matter what.
In the LONG term...no that is not a better strategy. If you have a chunk of money in the market and are looking to retire reasonably soon...perhaps taking some profit now is a fine idea.
Sure you may miss out on the next jump but so what, if it helps you sleep at night.
As long as you are disciplined and have a strategy that you are willing to stick to, you will be fine.
some people jump in and out based on the moving averages of the S&P 500...is that a better strategy than buy and hold and keep dollar cost averaging no matter what.
In the LONG term...no that is not a better strategy. If you have a chunk of money in the market and are looking to retire reasonably soon...perhaps taking some profit now is a fine idea.
This. Makes no sense to keep buying and then selling the S&P in a taxable account, especially if you are 20+ years from retirement, because you will just end up paying more capital gains taxes in the long run. I would personally prefer to pay less taxes. I think people who are constantly in and out of the market forget that they owe taxes every time they sell.GoAgs92 said:
There really is nothing wrong with taking profit off the table.
Sure you may miss out on the next jump but so what, if it helps you sleep at night.
As long as you are disciplined and have a strategy that you are willing to stick to, you will be fine.
some people jump in and out based on the moving averages of the S&P 500...is that a better strategy than buy and hold and keep dollar cost averaging no matter what.
In the LONG term...no that is not a better strategy. If you have a chunk of money in the market and are looking to retire reasonably soon...perhaps taking some profit now is a fine idea.
If I were to sell my entire taxable stock portfolio now, I would owe a huge tax bill at the end of the year that I would prefer to avoid.
This is the answer.GoAgs92 said:
In the LONG term...no that is not a better strategy. If you have a chunk of money in the market and are looking to retire reasonably soon...perhaps taking some profit now is a fine idea.
Well said. I'd also add that whether you handle your finances 100%, an advisor 100%, or a hybrid, always make sure to set aside time to review your holdings and % in stocks/bonds/cash/etc.GoAgs92 said:
There really is nothing wrong with taking profit off the table.
Sure you may miss out on the next jump but so what, if it helps you sleep at night.
As long as you are disciplined and have a strategy that you are willing to stick to, you will be fine.
some people jump in and out based on the moving averages of the S&P 500...is that a better strategy than buy and hold and keep dollar cost averaging no matter what.
In the LONG term...no that is not a better strategy. If you have a chunk of money in the market and are looking to retire reasonably soon...perhaps taking some profit now is a fine idea.
I did that for my mom a few days ago for the first time since my father died last year. She is clueless but that's ok. We found out together she's basically 65/35 to 55/45, depending on the account. She has barely lost anything as she is well diversified across the board. She was up 10-15% last year.
For myself, I'm 90/10 considering I'm 43. My losses are 5-10%, depending on if it's tech heavy, but I had 30%+ gains last year. No complaints. I rebalanced my 401k/IRA to be more diversified for the time being.
Why do you hope you are wrong? You should be hoping you're right.
I could see rebalancing to more cash/bonds and less stocks based on your best guess of what will happen but that's a pretty extreme approach to go to 0% equities.
I did notice you specifically said your trading account but then you extended the thought to 401k as well. What's your time frame of interest for needing 401k funds?
I could see rebalancing to more cash/bonds and less stocks based on your best guess of what will happen but that's a pretty extreme approach to go to 0% equities.
I did notice you specifically said your trading account but then you extended the thought to 401k as well. What's your time frame of interest for needing 401k funds?
halfastros81 said:
Why do you hope you are wrong? You should be hoping you're right.
I could see rebalancing to more cash/bonds and less stocks based on your best guess of what will happen but that's a pretty extreme approach to go to 0% equities.
I did notice you specifically said your trading account but then you extended the thought to 401k as well. What's your time frame of interest for needing 401k funds?
Why do I hope I am wrong? Well that is a simple answer. If I am right then I see a 30-50% drop in the markets. That will devastate the entire economy, ruin kid's college funds, hurt people's ability to retire, etc etc. If I am right then I buy back in in a year and, maybe two years, for half what I sold for, and double up my positions. That is good for me.
But here is the problem... I am a business owner who relies on the country doing well.. I make WAY more money when things are going well and the country is doing projects than I do off of the market. When the country is doing well I am employing people and taking care of their families. If the economic devastation I foresee happens, then I am laying off workers and seeing them suffer. I don't want to do that.
I hope I am wrong. Essentially I am hedging my bets. If the country does well my business does well, if the market collapses I double up my positions.
If I had real balls I would have taken that money and shorted everything. But I just can't do that to American businesses.
PA24 said:
A good stock trader has to be a paranoid schizophrenic to maintain his sanity.
Everyday is a new day.
This is true. Patterns don't mean anything. Information means little. Our country's plans and policies change every single day with this administration. What was sensible yesterday can be stupid today.
American is a ship without a rudder and you have to rethink everything you do business wise every day.
America thanks you sir!knoxtom said:halfastros81 said:
Why do you hope you are wrong? You should be hoping you're right.
I could see rebalancing to more cash/bonds and less stocks based on your best guess of what will happen but that's a pretty extreme approach to go to 0% equities.
I did notice you specifically said your trading account but then you extended the thought to 401k as well. What's your time frame of interest for needing 401k funds?
Why do I hope I am wrong? Well that is a simple answer. If I am right then I see a 30-50% drop in the markets. That will devastate the entire economy, ruin kid's college funds, hurt people's ability to retire, etc etc. If I am right then I buy back in in a year and, maybe two years, for half what I sold for, and double up my positions. That is good for me.
But here is the problem... I am a business owner who relies on the country doing well.. I make WAY more money when things are going well and the country is doing projects than I do off of the market. When the country is doing well I am employing people and taking care of their families. If the economic devastation I foresee happens, then I am laying off workers and seeing them suffer. I don't want to do that.
I hope I am wrong. Essentially I am hedging my bets. If the country does well my business does well, if the market collapses I double up my positions.
If I had real balls I would have taken that money and shorted everything. But I just can't do that to American businesses.
txaggie_08 said:
OP's going to need a much greater selloff than 5% to prove himself right.
And he has to get back in as well. I know a couple of people that got out in early 2008 but couldn't force themselves to get comfortable getting back in. By the time they did, one of them lost money and the other was barely above break even.
PA24 said:
A good stock trader has to be a paranoid schizophrenic to maintain his sanity.
Everyday is a new day.
That's what it seems like when you are not a good trader. The success doesn't come until you learn to trust yourself, turn off the news, and leave emotions at the door. The success comes from assessing the entry and having a plan. When that happens, and you are prepared, there is no freak out.
The problem most people have is they are never prepared for anything. They know one thing - buy and hope for up. They freak when it goes down and then freak harder when they arent willing to go long again at the time when everyone else is scared to death. They never make sound decisions because they were never prepared to make them. They are almost always off guard unless the market is trending up consistently within a low volatility environment.
I say this all from experience. As someone who acted like that and someone who's turned the corner and become extremely disciplined, prepared, and confident.
I like your answer. I also think you are taking a bit too much of a binary approach . There are more likely possibilities in between the economy tanks and stocks drop 30-50% and it continues to generally move forward in spurts and spells . If you are wrong you will have lost quite a bit of opportunity.
halfastros81 said:
I like your answer. I also think you are taking a bit too much of a binary approach . There are more likely possibilities in between the economy tanks and stocks drop 30-50% and it continues to generally move forward in spurts and spells . If you are wrong you will have lost quite a bit of opportunity.
I agree, but I do not have a time machine and I cannot predict the small jumps and individual stock moves. My selloff was due to my firm belief that the indexes are dropping 30% during the first two years of this admin. Will it have days or weeks it does well? Of course... but I have no idea what weeks those will be. Will I miss some opportunity? Of Course, but I'm not trying to time things, that is beyond my skill level.
A binary, medium term approach is something that you can predict pretty well by just looking at the economy, what is coming, and doing a little thinking. The idea of predicting short term gains is just not really possible in an economy in which everything changes daily.
Last thing... changing policies every time you answer the phone is literally the worst thing a leader can do. Set the rules and let markets adapt. This driving the bus without a steering wheel stuff is guaranteeing an economic meltdown.
Rough day today
It will be a rough couple of years clawing our way out of this decades long mess.10andBOUNCE said:
Rough day today
It's funny how bearish comments on here typically get ridiculed. I had a post awhile back regarding Buffet's unprecedented cash pile and the 10/2 treasury spread un-inversion that has always signaled a recession and I don't remember anyone agreeing that there was danger on the horizon. I wouldn't be surprised if this doesn't deepen to a 30% correction before the year is over. Just a tip to younger investors on here - when you are going to lunch and hear folks making comments like "I guess I will never retire" and those sorts of things, pile your money in. We aren't there yet.
People don't like to lose money so they are naturally going to speak against it. Also anything against prevailing norms, in any topic, will draw ire. This ain't done yet. Not even close to that lunch conversation!
Gold has been a pretty good safe haven so far. Looking at another all time high today.YouBet said:Bold but maybe this will be the year. History is against you but then past performance does not dictate the future.Tumble Weed said:
I posted last week (2/21) on the stock trading thread that I though the top for the year was in for the S&P 500.
I bought GLD, which has also dropped in value since I bought it. I expect gold to perform better than the S&P 500 this year.
Since Jan 2010, the S&P 500 has a total return of 603% while gold has a return of 114%.
Since 1926, on a 1-year time horizon, the S&P has a ~75% chance of beating inflation while gold has a ~45% chance.
And I'm not knocking you...I don't own any gold other than jewelry when I should at least have some allocation towards it.
Glad that I cashed out on the SP 500 on 2/21.
PA24 said:
A good stock trader has to be a paranoid schizophrenic to maintain his sanity.
Everyday is a new day.
Most western adults are anxiety riddled panic machines in all aspects of their lives. Stoicism in any respect is a dying trait.
Most people just don't have the stomach to watch the scary red line keep going down for very long before hitting the sell button.
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Markets are coming back. They will rise until Trump finds another reason to crash the market.
Infection_Ag11 said:PA24 said:
A good stock trader has to be a paranoid schizophrenic to maintain his sanity.
Everyday is a new day.
Most western adults are anxiety riddled panic machines in all aspects of their lives. Stoicism in any respect is a dying trait.
Most people just don't have the stomach to watch the scary red line keep going down for very long before hitting the sell button.
There's not a lot of room for error in many aspects of life...especially as you age.
So much truth.Infection_Ag11 said:PA24 said:
A good stock trader has to be a paranoid schizophrenic to maintain his sanity.
Everyday is a new day.
Most western adults are anxiety riddled panic machines in all aspects of their lives. Stoicism in any respect is a dying trait.
Most people just don't have the stomach to watch the scary red line keep going down for very long before hitting the sell button.
Best thing I ever did after the markets crashed in 2008 with the financials going under was stop trading stocks. Just went to work, bought index funds and didn't trade based off my own hunches. There are experts who do it every single day hour after hour and they still can't beat the indexes. Best decision of my financial life. Retired at 58.
the old time in market versus timing the market proposition going on here…..
This . Keep emotions out of it as much as possible and bet on businesses to increase value to their shareholders over the long haul.
There is so much built in incentive for the markets to continue upward. Fund managers MUST beat the indexes to keep their clients happy and maintain their bonuses. Money goes in every week/month into 401ks and pensions they get invested.halfastros81 said:
This . Keep emotions out of it as much as possible and bet on businesses to increase value to their shareholders over the long haul.
There's almost no way to time the markets even for the huge fund managers.
one example…Does anyone think the world can function without technology? Does anyone think there won't be new technology developed every year and suddenly necessary for every human and business on earth to remain competitive? Good luck betting against that.
Many indexes automatically rebalance to the top 100 or 500 top performers and market cap leaders every year. It's a built in system to maintain upward momentum and eliminate losing companies.
newbie11 said:There is so much built in incentive for the markets to continue upward. Fund managers MUST beat the indexes to keep their clients happy and maintain their bonuses. Money goes in every week/month into 401ks and pensions they get invested.halfastros81 said:
This . Keep emotions out of it as much as possible and bet on businesses to increase value to their shareholders over the long haul.
There's almost no way to time the markets even for the huge fund managers.
one example…Does anyone think the world can function without technology? Does anyone think there won't be new technology developed every year and suddenly necessary for every human and business on earth to remain competitive? Good luck betting against that.
Many indexes automatically rebalance to the top 100 or 500 top performers and market cap leaders every year. It's a built in system to maintain upward momentum and eliminate losing companies.
While true, this completely discounts external macro forces. Personally, I've never left the market since I started working 30 years ago so I'm a believer in time in the market vs timing the market. However, we can no longer just write off the unprecedented macro forces we are experiencing and about to experience.
Everyone on here has grown up in the Golden Age of post WWII Bretton Woods and just assumes nothing will ever change. That is supreme hubris. Our debt has skyrocketed to levels never before seen since 2008 and the math to address that (paying debt interest) is now our #3 most expensive line item. And it's only going to get worse. We've never had this situation before.
Now couple that with a retreat from global markets and supply chains to more regional models and you have massive change happening...right now. I still haven't left the market but have starting de-risking. I'm trying to hedge my bets as best as I can without wholesale leaving the market. I can understand why some people do that considering the reality right in front of us.
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