Join Early Retirement Today
Reply
 
Thread Tools Search this Thread Display Modes
Old 11-24-2014, 11:15 AM   #61
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
 
Join Date: Feb 2013
Posts: 5,327
Some of the reasons we lowered our stock AA were more mental than financial. I read the book Against the Gods: The Remarkable Story of Risk by Peter Bernstein. In it there were several mentions to the law of diminishing marginal utility - how after a certain point, it hurts a lot more to lose half your money than it brings joy to double it.

So I know over the long run, the odds are we are probably not going to make as much money having less in stocks, but I feel like one of the things we are buying with our money is not having to have any financial stomach churning in the future, which is more important to me than most other items I could buy with more money.

If I was Warren Buffet and losing half my money meant getting down to my last $40B, I'd feel better taking more chances. But losing half my money at my age might mean mean having one or both of us going back to a full-time megacorp job, and I'd rather have less income and live more simply than risk having to go back to working and commuting from 7 am to 7 pm, with 2 weeks off for vacation.
__________________

__________________
daylatedollarshort is offline   Reply With Quote
Join the #1 Early Retirement and Financial Independence Forum Today - It's Totally Free!

Are you planning to be financially independent as early as possible so you can live life on your own terms? Discuss successful investing strategies, asset allocation models, tax strategies and other related topics in our online forum community. Our members range from young folks just starting their journey to financial independence, military retirees and even multimillionaires. No matter where you fit in you'll find that Early-Retirement.org is a great community to join. Best of all it's totally FREE!

You are currently viewing our boards as a guest so you have limited access to our community. Please take the time to register and you will gain a lot of great new features including; the ability to participate in discussions, network with our members, see fewer ads, upload photographs, create a retirement blog, send private messages and so much, much more!

Old 11-24-2014, 11:39 AM   #62
Full time employment: Posting here.
 
Join Date: Jan 2013
Posts: 660
I wasn't a member of this forum during the 2008 downturn, but I've participated in other financial forums during other bear markets, and I expect that there will be a wide variation in responses to the next bear market. So much so that I may temporarily stop reading this forum during a major downturn. My impression is that there is a plurality of members here who are fairly committed to buy and hold, but that it probably isn't a majority. And of course a downturn, especially a big one, is an open invitation to market timers to espouse their favorite "beat the market" strategies.
__________________

__________________
karluk is offline   Reply With Quote
Old 11-24-2014, 12:01 PM   #63
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
Lsbcal's Avatar
 
Join Date: May 2006
Location: west coast, hi there!
Posts: 5,693
Quote:
Originally Posted by karluk View Post
... My impression is that there is a plurality of members here who are fairly committed to buy and hold, but that it probably isn't a majority. And of course a downturn, especially a big one, is an open invitation to market timers to espouse their favorite "beat the market" strategies.
You are probably right that buy-hold predominates here, but at least other ideas are discussed too with usually sensible restraint. I find that refreshing and at least entertaining. Lumping all market timing discussion into the "bad bin" is not wise.

There is absolutely no way to prove that any method is superior going forward.
__________________
Lsbcal is offline   Reply With Quote
Old 11-24-2014, 12:10 PM   #64
Full time employment: Posting here.
 
Join Date: Jan 2013
Posts: 660
Quote:
Originally Posted by Lsbcal View Post
There is absolutely no way to prove that any method is superior going forward.
You are right, but oddly enough that is precisely the reason I don't care to read about market timing schemes during times of doom and gloom, when it seems that buy and hold is a fool's game, and only a well thought out market timing scheme will allow anyone to make a profit. Market conditions during a downturn give such posts an air of wisdom they don't really have. After all, as you say, there's no way to prove whether the market timing scheme being advocated is really any better than buy and hold.
__________________
karluk is offline   Reply With Quote
Old 11-24-2014, 12:32 PM   #65
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
 
Join Date: Nov 2007
Posts: 7,531
I think there was a lot of "the sky is falling" sentiments getting tossed around. I remained very bullish the entire time and had lots of fun*. I even switched to a more aggressive portfolio allocation in November 2008 (missing the absolute bottom by a few months).

My comments from 2008 from the thread W2R linked:
Quote:
Just moved 15% of my portfolio from a large cap growth fund (down ~45% YTD) to a mix of US and international REITS and int'l small cap (all of which are down close to 60% YTD). So I guess I'm willing to take on more risk. Or rather I have moved my permanent asset allocation to what I want it at long term.
I'm still sticking with that new "permanent" asset allocation and don't plan on changing it any time soon (other than maybe decreasing my near 100% equities allocation to include more bonds/cash).

I think there were plenty of other people embracing the crash. I recall commenting something to the effect that "this is the buying opportunity of a lifetime for investors my age" (28 at the time).


*fun, but in the middle of a scary environment. Our company laid off half the employees, then half of what was left departed for better opportunities. We had a pay freeze, then pay cut. I decided to take the bar exam and get my law license "just in case". Everything worked out okay in the end, and I wasn't really worried since I had many many years of expenses in the bank even back in 2008 and 2009.
__________________
Retired in 2013 at age 33. Keeping busy reading, blogging, relaxing, gaming, and enjoying the outdoors with my wife and 3 kids (5, 11, and 12).
FUEGO is online now   Reply With Quote
Old 11-24-2014, 12:49 PM   #66
Moderator Emeritus
 
Join Date: Oct 2007
Posts: 4,929
Meh. M... E... H...

What happens if the unthinkable happens?

I took the opportunity to clean up and simplify the portfolio at minimal cost, which also accomplished substantial tax loss harvesting, and rebalanced back to my long term personal investment plan's target. The losses booked will offset any capital gains that are realized for several more years.

Markets fluctuate. That's why I made a long term investment plan.
__________________

__________________
M Paquette is offline   Reply With Quote
Reply


Currently Active Users Viewing This Thread: 1 (0 members and 1 guests)
 
Thread Tools Search this Thread
Search this Thread:

Advanced Search
Display Modes

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off
Trackbacks are Off
Pingbacks are Off
Refbacks are Off


Similar Threads
Thread Thread Starter Forum Replies Last Post
Android tablet with firefox crash during posting sengsational Forum Admin 9 08-17-2014 04:32 PM
Your Ring Tone TromboneAl Other topics 34 06-21-2010 01:58 PM
No Dial Tone......what is cause? kaneohe Other topics 12 07-25-2009 01:57 PM

 

 
All times are GMT -6. The time now is 02:56 PM.
 
Powered by vBulletin® Version 3.8.8 Beta 1
Copyright ©2000 - 2017, vBulletin Solutions, Inc.