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Yeah, but I don't have the guts to do it - yet. I've been stung once or twice when selling, so past "poor investor behavior" holds me back. Also, I've enough cash to last for three-four years, so that I really hate to disturb the portfolio. Worse, I keep remembering the high of Jan. 26th - at that time I had at least a 7% gain. Combine that with 2017 - total gains for two years 27% - should have taken that and run and sat out this year. At the same time, if I ride it out all the way down and it takes four years to recover, I'll be really mad at myself. So, I'm conflicted.
All that said, standing back, I consider the current occupant of the WH and his Administration so incompetent and irrational that one would have to mad to be an optimistic investor under these clowns. The current Administration is the real problem with the market - and that won't be changing for another 2.5 years, sadly.
Well don't look back to late January..that is true hindsight. NOBODY would have seen a 10 percent correction from there. But remember on the year its barely down. Frankly I count that run up in January as pure investor greed. The bear really starts from now. Or not. LOL
We have been up and down a lot over the past couple of months. But now with the new tariffs, a possible trade war and rising interest rates it seems to be a no brainer that the market in general is heading down or at least flat for an extended period.
What do you think?
Don't be so sure. With a crazy person like Trump assuming the presidency, it was a "no brainer" too that the markets would crash.
The 2017 runup occurred BEFORE any damage had been done - the 2017 Trump effect was due to expectation of regulatory relief, tax reform and repatriation.
Today, it turns out the December tax "reform" is an IRRESPONSIBLE deficit ballooner rightly causing concern - and on top of that add the recently announced TARIFFS - even the TALK of tariffs - has created all manner of worries.
So, no, 2017 can't be compared to now - in any way.
Those of you who are crying and complaining, likely should not even be in the market, too many of late are used to the market only going up, so they cannot handle it when it inevitably has to go down.
I think it isn't so much that people don't anticipate cyclical corrections from time to time as it is the fact that it's impossible to know with absolute certainty whether this is just a correction or 1929 revisited. Most of us can ride out a typical downturn of a year or two. But who can say with absolute certainty whether present events are just a prelude to another normal downturn or the harbinger of a disastrous crash? If there is going to be a crash, then I obviously want to rescue at least some of my investment, not least because I would like to buy back in after it appears that the market has bottomed out. As the old adage has it, buy low and sell high. But you can't buy low if you didn't sell at the beginning of the plunge. So that's another source of anxiety at the present time. You suspect that you should be doing something and not just allowing your investment to coast on autopilot...but then what if you do cash out and the market suddenly soars upward for the long term?
Arrrrghhh!!
There was a time when events like this were just another news story to me. Now they hit me in the wallet. To be fair about it, though, I did enjoy the upswing during the latter half of last year.
it's impossible to know with absolute certainty whether this is just a correction or 1929 revisited. Most of us can ride out a typical downturn of a year or two. But who can say with absolute certainty whether present events are just a prelude to another normal downturn or the harbinger of a disastrous crash?
These things can only be known in hindsight. Plan for something in the middle between typical downturn and big crash. No one knows when it will happen. A downturn absolutely will happen because that's just the way it goes with markets. How severe and how long it lasts and when it hits are the unknowns.
2008 was a big crash, wouldn't you agree? Nothing normal about that. How did you fare? Did you panic and sell after it started? Did you ride it out and keep investing as you normally would? Consider what your past behavior was in that market, with losses reaching over 50% in some cases, before the recovery started, and take a look at your allocation today and see if you need to adjust it.
Make sure you have a year's expenses in something safe(r). If you're near retirement or in retirement and you will spend down your portfolio to cover your living expenses, make sure you have at least 2 to 5 additional years of expenses in something with lower volatility (like bond funds and income funds).
I think it isn't so much that people don't anticipate cyclical corrections from time to time as it is the fact that it's impossible to know with absolute certainty whether this is just a correction or 1929 revisited. Most of us can ride out a typical downturn of a year or two. But who can say with absolute certainty whether present events are just a prelude to another normal downturn or the harbinger of a disastrous crash? If there is going to be a crash, then I obviously want to rescue at least some of my investment, not least because I would like to buy back in after it appears that the market has bottomed out. As the old adage has it, buy low and sell high. But you can't buy low if you didn't sell at the beginning of the plunge. So that's another source of anxiety at the present time. You suspect that you should be doing something and not just allowing your investment to coast on autopilot...but then what if you do cash out and the market suddenly soars upward for the long term?
Arrrrghhh!!
There was a time when events like this were just another news story to me. Now they hit me in the wallet. To be fair about it, though, I did enjoy the upswing during the latter half of last year.
I understand but people who cannot handle the pucker factor should either not be in the market or should have some of their money in safer investments or a safer allocation like 50/50 or 60 bonds and 40 equities and if in retirement, like I am, then maybe a immediate annuity as a part of the portfolio. Annuities are surely not for everyone but I sure sleep better at night knowing that income is coming in like clockwork, regardless of what the market does.
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