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Old 03-04-2009, 03:26 PM   #21
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Ok, maybe I've had one too many meds today.
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Old 03-04-2009, 03:34 PM   #22
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Ok, maybe I've had one too many meds today.
Parallel universe?
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Old 03-04-2009, 03:50 PM   #23
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We have avoided losses on stocks because we've never owned a stock. I know everyone says you can't accumulate wealth without being in the stock market. Yup, we're not wealthy. Instead we "invested" in sure things like paying off our house and cars. And I buy CDs.

As for retirement my husband is a public employee and is in his 25th year and hopes to stay until 30 and get his pension. I'll get a small Social Security payment when the time comes. So far it looks like we can actually live on this.

I realize my risk tolerance in just about zero. I need to be able to sleep at night and I don't want to wake up and turn on the news and find out that something somewhere has happened and I've lost money. Buying stocks just looks too much like gambling.

Someday, I may get brave enough to get into a mutual fund.

I know my husband's state pension fund is partially invested in stocks, that's about as close as it gets.
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Old 03-04-2009, 04:39 PM   #24
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I'd like to say I dumped everything in June of 08. I'd have about 2KK more than today. I did sell about 15% of my holdings in a high flyer (that represented >50% of NW). All that means is I have slightly more than when I ER'd in June 07 (including enough cash for 5 - 8 years that I've never had before).

I really want to get back in, but that would bump my AA to >80% equities and I'm a big chicken.
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Old 03-04-2009, 04:48 PM   #25
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Soooooo....... has anyone looked at the numbers and done a comparison of portfolio performance for some lengthly time period, say 20 years, comparing an equity heavy portfolio vs an all fixed portfolio, including the impact of taxes?

If someone went 100% TSM in March, 1989 while another went CD ladder or total bond market at the same time, how would they compare today? Has this downturn removed all of the incremental gains the equity portfolio would have had going into it?
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Old 03-04-2009, 04:58 PM   #26
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Ahhh, so THAT'S where the "Ignore This Thread" tool is!

Just kidding, congrats to the people who timed it right, or have been conservative during the right times.

You know, an interesting FAQ for the forum would be a list of topics that reflect poster sentiment whenever we are nearing some inflection point in the market. So we couldn't add a thread to the list until it was history. I came across one the other day in a search for something else, interesting to read contemporaneous accounts at those points.

Good thing they locked down that "edit" button, or we'd ALL be geniuses. But some of us would be poor

Razer was the guy wanting to get in/out around 14,000 right? He sure would not be trading much these days. I think the consensus was that you could probably buy puts cheaper than what he was doing, probably not at this point though. dunno.

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Old 03-04-2009, 05:30 PM   #27
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Originally Posted by kumquat View Post
I'd like to say I dumped everything in June of 08. I'd have about 2KK more than today.
Are you saying that you are down $2 million since June 08?

WooHoo! you are probably the grand prize winner. But you must still be very wel off.

Ha
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Old 03-04-2009, 05:51 PM   #28
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I used to trade mutual funds on a daily basis. It was not unusual for me to do 2 round trips of a million $ plus per week. In early 2000 the mutual fund companies blocked me from doing these transactions without large penalties. I have spent a lot of time since then backtesting investment schemes, but have yet to find another "sure thing". Other than a few day trading "test" attempts since then, I have been 100% in "cash". From 2000 through 2002 I felt pretty good about staying out of the market, but it was frustrating having to watch the market rise from 2003 to 2008. Obviously, I've felt like a genius since then as the market even erased the gains from 2003 to 2008. Now I worry that I've been out so long that I won't be able to pull the trigger when this market turns around.

I must confess, I haven't escaped unscathed though - my house has dropped probably $300K . . . maybe more . . . from the peak, although it will have to more than double that before I show a loss.
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Old 03-04-2009, 06:06 PM   #29
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My portfolio is up modestly since Oct 07. This is not a surprise, since my portfolio is always up only modestly. When the next round of euphoric stock buying takes hold, y'all can switch quickly from jealousy to scorn. It's happened before, and will most likely happen again.

I don't know how I ever came up with the idea of investing primarily for income rather than capital appreciation (this hasn't been the conventional wisdom during my lifetime), but this strategy has served me well in all types of economic climates for over 20 years.
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Old 03-04-2009, 06:34 PM   #30
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(riskadverse---shouldn't that be 'riskaverse'?)

I used to be almost 100% equities, but last year I began to build cash and bought some bond funds and a big 5-year CD to build a CD ladder in anticipation of retirement. I have been 50/50 US/foreign for a long time. I am now about 60/40 equities/bonds etc. (yeah, I was rebalanced by the market, too)...but none of this prevented me from an over 45% drop in total portfolio value. I am set back only 5 years, which is not too bad considering the Dow and the S&P 500 are as low as they were first in 1997. They are set back 12 years. I am planning that it may take me 5, maybe 7, years to recover.

I am looking at shifting some of my index funds to a couple of high-yield ETFs (SDY and PID). That is the only thing I am doing different as a result of the market collapse. If and when I am in the situation where I cannot find work anymore and therefore have the time, I will consider individual stocks.

I rode out the Crash of '87 and I will ride this one out.
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Old 03-04-2009, 07:23 PM   #31
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In May of 2008, I was speaking with a ER'd neighbor who retired from Microsoft and manages his own money (a lot of it) and gives advice to others. He said he was very wary of the market then. Somehow he knew of the problems developing in the credit markets and that a major correction would likely happen in the next few weeks. I said I have no idea what the market is going to do. I said it could go up or drop 45% like 1973-1974. He was off a few weeks in the time to the market crash. I don't know if he was lucky or good. I did not take him seriously at the time and of course did not change my AA. Little did I know a Papa Bear market was around the corner.
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Old 03-04-2009, 07:41 PM   #32
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Pure luck on my part. I had many small to midsize accounts that I began to consolidate in the summer of 2007 - all to a Vanguard account. I didn't want to make small purchases into the market as all these accounts slowly rolled over. So I decided to wait until all the money was there and then allocate it. The market started to slide by Autumn so I just let it sit there. Still sitting collecting dust... can't decide if I should invest it all in the market vs. pay penalty and the taxman on a withdrawal and pay off my house (I know, different thread x 100).

PS-if it makes you feel better I didnt cash out of an annuity because I would have incurred $1000 in fees. Instead, by leaving it, I'm down about $30K
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Old 03-04-2009, 08:08 PM   #33
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Need to call BS on Dawg even though he declared his own BS with the head pounding for the last six months or longer, ask Runnng Man for a link to subscribe to his newsletter and then soak in for a moment from the "scaredy cats" and conservative folks.
A Dave Ramseyism no matter how many times he reads the tortoise and the hare the tortoise always wins.
I'm 75/25 right now 45 and still working. Really no reason to be 100% stocks and if I had used a 50/50 or lower equities the last 25 years I would be further ahead more risk for more reward? Maybe maybe not depending on who sets up the game, plays the game and who referee's the game.
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Old 03-04-2009, 08:26 PM   #34
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  • Got spooked and sold everything in May, 2008; this time, unlike the last time, I was really going to stick to my technical indicator for reentry:
http://www.early-retirement.org/foru...tml#post708328
Quote:
You have to expect the downward trend to continue - especially through September given this month's historical trend. I got out of every mutual fund I owned in May (selling portions into the rallies on up days) based on the 6mo/12mo simple moving average bearish trend on major US Indices:

S&P 500 INDEX ($INX) - Stock chart, Index chart - MSN Money

Now the tough part (for me in previous downturns anyway) is sticking to the signals and only re-entering on the long term trend reversal and not getting back in too early.
  • Fast forward 4-5 months and I'm already throwing caution to the wind, trying to buy back in ahead of what I thought was the bottom:

    Staying the course?

    Quote:
    I'm slowly moving from cash back to stock at this point.


Next time will be different, honest
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Old 03-04-2009, 10:10 PM   #35
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I was out, except for about 5% in a healthcare mutual fund, by November of 2005. I was working about 18-20 hrs. a week, off and on, from 2003 to 2005 for our oldest son, who is a residential construction contractor.

Except for 2 houses, all the houses we put up were between $425K and $750K. A lot of the homeowners were complaining about how they were on the edge(payment wise) and getting ARMS and still had new, or nearly new luxury cars, SUVs, vans(usually 2).

Their ideas of conserving money was to paint the attic over the 3 car garage themselves or drywall a half wall in the basement; not build a smaller house. At that time I realized the world was moving too fast for me, so I just dropped out and went to CDs. It was just about a total flight to safety, thanks to the people who were in over their heads and scared the financial daylights out of me.

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Old 03-04-2009, 11:31 PM   #36
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As mentioned elsewhere, I became risk averse during the 74/75 unpleasantness. Sold all my MFs at the bottom and went to stable value fund for all of MY money. The good news is that I let my company's matching stock in 401(k) ride until late 90s and then sold most of it, adding it to my stable value fund. That single stock provided me the bulk of my invested assets as the stable fund only outpaced inflation by a relatively small amount while company stock exploded for the last 10 years I had most of it.

Still have quite a few shares of old company stock and it's taken a huge hit, but is STILL worth WAY more than I paid for it (as 401(k) match and stock options). All in all, I'm up from my retirement date (05) and maybe down very slightly from my all time high (do have some MFs again, slowly adding since 99).

Given a do-over, I'd have stayed in back in the mid 70s and averaged out of company stock much sooner. Still, I've done very well by luck. As always, luck is better than brilliance any day - at least for me. All of this to say I have no insight nor do I claim any bragging rights. I do feel fortunate, however. I could have done better and I could have done a lot worse.
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Old 03-05-2009, 02:25 AM   #37
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....

Their ideas of conserving money was to paint the attic over the 3 car garage themselves....

jr
That is so funny, definitely an indicator.

It was the age of "conserving money [by] paint[ing] the attic over the 3 car garage themselves."

Yes, that is what is was.
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Old 03-05-2009, 06:53 AM   #38
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Hi,

After my "UGH, almost ready to give into Panic" post in June of 2008 I started selling but didn't mention it here because I didn't want to be a dirty market timer. I sold all my old B shares and am down to 20% stocks.

Unfortunately I didn't get rid of a bunch of GE and I actually bought some more and averaged down a bit. Had I sold it, I would have cut my losses into the upper teens from the peak but still down less than 30%.

Woulda coulda shoulda.

Good Luck from here.

W
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Old 03-05-2009, 07:36 AM   #39
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Need to call BS on Dawg even though he declared his own BS with the head pounding for the last six months or longer.
Actually my stocks are down so much I feel like I'm 100% cash.
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Old 03-05-2009, 08:08 AM   #40
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Actually my stocks are down so much I feel like I'm 100% cash.
Ain't it great?
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