All set to go shopping

[brewer12345]

I've sampled some discount equities thus far, but I haven't really jumped in yet. I just liquidated the remains of my EFA position and I am all set to buy some absurdly cheap stuff. But I am waiting for just a little wider discount. Anyone else?

 

[cute fuzzy bunny]

Waiting another week, maybe two.

I think its not done yet.

But I think its just an overreaction to an overbought market slidind into a moderately oversold one. I think we'll get good bargains around thursday/friday of this week...

 

[brewer12345]

Waiting another week, maybe two.

I think its not done yet.

But I think its just an overreaction to an overbought market slidind into a moderately oversold one.  I think we'll get good bargains around thursday/friday of this week...

Agreed. I will be looking for an opportune time to dump my QQQQ puts when it drops to about 37, and that is about the time I expect to put cash to work. Actually, I see a couple of things I will jump on very soon, but I have some restrictions to wait out.

 

[cute fuzzy bunny]

Sure, some stuff's had a real hammering already.

"PENNYS IS HAVING A SALE!!!"

 

[KB]

I have $110,000 in Vanguard's Prime MM in an IRA account.  Ready to move into Mutual funds.
Just waiting for the right time.  I might DCA, might just go ahead and buy what I want. 

I'm still trying to decide exactly what to buy.  Any suggestions?  I won't touch the money for at least 6 years when I'm 59.5 .....hopefully a lot longer.

So far I'm looking at the following funds: Wellington, Wellesley, Total Int'l indx, Sm value Index, Small cap index, large val indx, large cap indx and maybe the reit index and a bond indx. Maybe also Tot stock market or 500 indx. I do have a Roth IRA with the Target 2015.

 

[brewer12345]

I have $110,000 in Vanguard's Prime MM in an IRA account.  Ready to move into Mutual funds.
Just waiting for the right time.  I might DCA, might just go ahead and buy what I want. 

I'm still trying to decide exactly what to buy.  Any suggestions?  I won't touch the money for at least 6 years when I'm 59.5 .....hopefully a lot longer.

You are talking about mutual funds, not individual equities, right? If emerging markets continue their meltdown for much longer, it might start to be an opportune time to buy some.

 

[KB]

Yes, I'm talking about Mutual funds. I don't want to mess with individual stocks. I'd really like an auto pilot kind of IRA where I rebalance annually.

 

[Jay_Gatsby]

Something smells like market timing... :

 

[brewer12345]

Hmm, Russell 2k bounced off a 10% coorrection today, and Nas wasn't far behind. I see some beaten down, heavily shorted stuff starting to rebound. Looks like we are getting some traction. Might be time to start unloading puts.

 

[HFWR]

Something smells like market timing... :

Glad I didn't step in it...

 

[LovesLife]

I did a little shopping today. A little mid cap and international. 3K each. I am still not up to the level of equities that I want to hold and thought I would just put a little in here and there.

 

[Ed_The_Gypsy]

KB quoth:

I have $110,000 in Vanguard's Prime MM in an IRA account. Ready to move into Mutual funds.
Just waiting for the right time. I might DCA, might just go ahead and buy what I want.

I'm still trying to decide exactly what to buy. Any suggestions? I won't touch the money for at least 6 years when I'm 59.5 .....hopefully a lot longer.

So far I'm looking at the following funds: Wellington, Wellesley, Total Int'l indx, Sm value Index, Small cap index, large val indx, large cap indx and maybe the reit index and a bond indx. Maybe also Tot stock market or 500 indx. I do have a Roth IRA with the Target 2015.

KB,

I once DCA'd in, but later read that it is better to be all-in than part-way in when the market turns. Today, I might do it in bigger chunks (such as half or a third at one time). Do what you are comfortable doing.

If you are going to use Wellington and Wellesley, do you need to do anything else (except a portion of Total International)? Personally, I do the slice-and-dice thing, favouring small cap, value, international and REITs, but I have a proportional share of VFINX, too. I like it that you do not have any 'growth' on your radar. I think value will 'grow' better.

I don't like bond funds. (I don't like anything with a bond fund component.) You will lose principle if rates go up. Instead, start building a CD ladder, like Galeno. For you, it is time. I buy the argument that Social Security will be equivalent to a bond (fixed-income) asset class.

Good luck,

Ed

 

[Momtwo]

I put a tidy sum in VGTSX!

 

[AltaRed]

I don't like bond funds.  (I don't like anything with  a bond fund component.)  You will lose principle if rates go up.  Instead, start building a CD ladder, like Galeno. 

I agree. I would prefer to buy individual bonds outright and hold to maturity, or do a CD (or in Canada, a GIC) ladder.

 

[Ed_The_Gypsy]

AltaRed,

One of the problems I have with bonds, per se, is that often they are callable. Why bother?

AltaEd

 

[brewer12345]

I don't like bond funds.  (I don't like anything with  a bond fund component.)  You will lose principle if rates go up.  Instead, start building a CD ladder, like Galeno.  For you, it is time.  I buy the argument that Social Security will be equivalent to a bond (fixed-income) asset class.

Good luck,

Ed

Not to beat the dead horse again, but you don't avoid losing principal in a rising rate environment just because you bought individual bonds/CDs.

 

[brewer12345]

Sold my puts today. Might be arriving at the party a little early, but when I am about ready to buy some more BPOP and SUP. When I get back from the 3 day weekend, I will be making a big bet on a specific sector.

 

[haha]

I still hold, but that is partly because when I laid out the money originally, I meant to hedge meaningful market drops, not small or even moderate changes.

I don't know enough to manage the position well. My working plan is to keep the 40s until their % increase on an up day is < the % increase of the lower strikes, or until they are so far in the money that my fear of losing my gain overcomes my desire for more. 

I am not ready to take off my hedge, though I will likely juggle the strikes.

Who knows what might happen, but a rally like today's off of an oversold condition that lasts only 3/4 of a trading day is not a real positive sign. Suggests to me that big money wants to exit, at least for now.

Ha

 

[brewer12345]

Meh, maybe. I've de-risked my portfolio substantially, and the big plunge I plan on taking next week is not in a sector sensitive to an economic slowdown or a quickening of inflation (though it definately has other risks). Good enough for me, since I have a relatively high risk tolerance.

 

[wabmester]

No idea.   We might be due for a "relief rally," but personally, I think you're a couple years early dropping your hedge.   What's the best-case upside?   Do you think interest rates will drop back down to 2%?   Another big war?   This party is over for a while, and I think we're looking at sideways at best, and who knows at worst.

 

[cute fuzzy bunny]

Thats what I said about three years ago.

Ooopsie.

 

[wabmester]

Thats what I said about three years ago.

Ooopsie.

Three years ago, interest rates were dropping and we just declared war. What were you thinking?

 

[haha]

Whenever I can, I like to find investments that won't be hurt by discontinuities. Back in the mid-80s there were gas producers with contracts with the pipelines at $6-$9 MCF. These were hugely over market, since the bottom had fallen out of the gas market since they were contracted. Investors were seeking these companies, since they were getting more for their gas. I reasoned just the opposite- the only thing that might happen here is bad, the contract gets broken. I didn't know if that would happen, but it seemed at least a fair bet. So I went looking for an entity with below market contracts, figuring this could only stay the same or get better. And the same forces that were set in motion trying to release pipelines and consumers from paying over market rates, might also allow this company to get at least a market rate.

I found an MLP with gas contracted at $0.35! So I bought it, along came FERC, and before too long my outfit was getting $1.80, just like everyone else. And of course they were now free to respond to market forces, which I viewed as mostly upside.

Today, twenty years later, the quarterly distribution on this outfit is close to half of what I paid originally. If I hadn't sold some over the years, to "diversify", I could almost have retired on that one small investment.

 

[wabmester]

If I hadn't sold some over the years...

Story of my life. I always sell my winners too early and my losers too late. That's what makes timing so hard. You have to get all three things right: what to buy, when to buy it, and when to sell it. So, I gave up on that and just try to adjust my asset allocation based on simple stuff like E/P vs treasury yield. I'm about 45% cash today.

 

[brewer12345]

No idea.   We might be due for a "relief rally," but personally, I think you're a couple years early dropping your hedge.   What's the best-case upside?   Do you think interest rates will drop back down to 2%?   Another big war?   This party is over for a while, and I think we're looking at sideways at best, and who knows at worst.

Yeah, I have to agree, but I am mostly invested in equities that do not move with the indexes. I have basically a portfolio that would do well in an economic "brown-out", with some inflation hedges in place. Plenty of risk and reward, but mostly non-systemic.