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Of course you experienced those high returns over the last couple of years because Stocks are in a Bubble right now. When the rate increases, you will see corrections, look for the losses most likely the rest of this year (if rate goes up in Sep) all the way through 2017 or 2018 as the market corrects itself back DOWN. Stocks are extremely overpriced and overvalued because the artificial demand for them has skyrocketed due to savers running into the market as their Banks aren't paying them anything.
When rates increase and CDs are back over 3% - 4%, Stocks are going down, down, down. I honestly would be looking to take my Stock Returns and GET OUT right now before that rate increase occurs, but you know with The MathJak Team you are supposed to hold until Jesus comes back so....
The rates are going to increase but the fed's aren't going to jump full % points in matter of months. 3-4% is going to take s-o-m-e time coming. Also, the money I'm putting in I don't intend to take out for a long time (my retirement is close to 30yrs away).
Also, yes I've been taking money out but they are coming out of the winners I've had and putting them in the one's that are currently down (europe, emerging to name a few). I see the rate increase(s) and the accompanying volatility as an opportunity.
The rates are going to increase but the fed's aren't going to jump full % points in matter of months. 3-4% is going to take s-o-m-e time coming. Also, the money I'm putting in I don't intend to take out for a long time (my retirement is close to 30yrs away).
Also, yes I've been taking money out but they are coming out of the winners I've had and putting them in the one's that are currently down (europe, emerging to name a few). I see the rate increase(s) and the accompanying volatility as an opportunity.
Me too in terms of opportunity. For example, I'm not in Stocks at all right now, but if I'm going to get it, I'm waiting until the Rate increases come in to drive valued companies/funds down to a discount.
Me too in terms of opportunity. For example, I'm not in Stocks at all right now, but if I'm going to get it, I'm waiting until the Rate increases come in to drive valued companies/funds down to a discount.
IMHO, all I can offer you is in the quest to seek 'value' companies for a discount I hope you don't catch falling knives because the 'real' valued companies would actual be sought after more in such an environment.
If you're really going to invest, forget individual stocks. Just put your money in a total market fund/etf and forget about it.
IMHO, all I can offer you is in the quest to seek 'value' companies for a discount I hope you don't catch falling knives because the 'real' valued companies would actual be sought after more in such an environment.
If you're really going to invest, forget individual stocks. Just put your money in a total market fund/etf and forget about it.
Wondering how everyone who has their 401k's in stocks right now is faring?
Especially those folks who said keeping your retirement funds out of the stock market was a bad idea.
Let's see if your "analysis" was accurate - I'll be back here in 2 months and bet most of you will have bailed or written off what you once had. I think there's still time to get out before everything bottoms out in a few weeks, but don't take my word for it, I only see patterns/cycles (and have lived through many). I could be wrong but definitely wouldn't bank on the stock market this year at all for 401ks or IRAs.
Want to bet except for amatuers who should not be in equity' s in the first place that most seasoned investors follow their plan including myself and i am retired living on my portfolio.
Corrections are nothing new and are all part of the long term deal.
I have been through 30 years of this the same as other long term investors and success comes from just following the plan through.
Wondering how everyone who has their 401k's in stocks right now is faring?
Especially those folks who said keeping your retirement funds out of the stock market was a bad idea.
Let's see if your "analysis" was accurate - I'll be back here in 2 months and bet most of you will have bailed or written off what you once had.
I'm faring fine, thank you. The money I have in the market is money I won't need for at least another 15 years, so what do I care if the market drops now? It's just a buying opportunity, as far as I am concerned.
And I didn't bail in 2007-2008, so why would I bail now?
Anyone who needs their money in the short-term (less than 15 years), or who panics every time stock prices go down shouldn't be investing in the stock market. The investor's biggest enemy is usually himself.
I'm faring fine, thank you. The money I have in the market is money I won't need for at least another 15 years, so what do I care if the market drops now? It's just a buying opportunity, as far as I am concerned.
And I didn't bail in 2007-2008, so why would I bail now?
Anyone who needs their money in the short-term (less than 15 years), or who panics every time stock prices go down shouldn't be investing in the stock market. The investor's biggest enemy is usually himself.
Aredhel, I am interested to see what you think about my open thread on this section? I broke down the Balanced Funds over the previous 20 years in terms of their compounding rate, compared them to Long Term CD compounding rates over the same period of time, and guess what? They were damn near equal .
I would love to see your explanation on it, because if my Math is correct I don't see why someone would take on so much risk for the same return or perhaps maybe a 1% - 1.5% higher compounded rate of return per year.
It is always investor actions that hurt them. Markets have always recovered and gone on in the longer term , always.
It is only those who invested greater than their pucker factor , used long term assets for short term money ,or thought they could time things that got burned assuming broad diversified funds.
Aredhel, I am interested to see what you think about my open thread on this section? I broke down the Balanced Funds over the previous 20 years in terms of their compounding rate, compared them to Long Term CD compounding rates over the same period of time, and guess what? They were damn near equal .
I would love to see your explanation on it, because if my Math is correct I don't see why someone would take on so much risk for the same return or perhaps maybe a 1% - 1.5% higher compounded rate of return per year.
The compounded 15 year return for fidelity balanced fund is 7 % . Your 15 year cd returns are about 5% and that is with a decade that had 2 back to back recessions and almost a total financial collapse.
Almost 1.50x the money at a more favorible tax rate or even no taxes if in a taxible account if you are in the zero capital gains bracket .
that was one of the crappiest times in history and that was the end result , so yep well worth it . WANT TO COMPARE TO A STRAIGHT UP EQUITY FUND LIKE FIDELITY LOW PRICED STOCK FUND , which i held most of those years ? almost 13% compounded return over the same time frame .
with bonds soaring most of those years actual compounded investor returns were in the 6-8% range from most diversified portfolios with a tax advantage under some circumstances . .
Last edited by mathjak107; 08-22-2015 at 08:05 AM..
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