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Old 06-06-2008, 04:59 PM   #141
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I'm going to begin buying Vanguard's Emerging Markets Fund on Monday - I'll avg into it over the next year or less.

I'll be adding to my commodies fund next week also.

I think the future of investing (positive returns) is outside the USA.
I increased my VGENX a few months ago, and increased my VEIEX position by 50% last week, so I'm with you. I also took bonds from 20% to 24% overall.
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Old 06-06-2008, 05:04 PM   #142
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How about a little market-neutral in the mix? Or maybe a lot...

I already have a sizable amount of HSGFX (Hussman strategic growth) - a long/short fund that has never (yet!) had a losing year. I also own about 100k of HSTRX (Hussman strategic total return) - his fixed income/gold offering (also has never had a losing year - yet!).

The longer I watch the market, the more I'm leaning towards just putting all of it into these 2 funds - 60% HSGFX and 40% HSTRX. He varies defensive stances based on historical measures of valuation.

I simply believe that anyone who believes that valuations don't matter have their heads buried in the sand. And, as Buffet has said, not losing a lot of money is often more important than making money.
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Old 06-06-2008, 05:17 PM   #143
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Put your smiles on people we just got handed another discount coupon!

So ditch your plan at your own peril.
My portfolio took a nice nose dive today. Not the kind of discount I enjoy. And I will adjust my portfolio as I see fit. But thanks for the advice.
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Old 06-06-2008, 05:25 PM   #144
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Mine went down 1.1%.

The decrease seemed pretty universal. Even "pssst...Wellesley!" went down, though not as much as some others. In my portfolio only VFSTX Short Term Invesment-Gr Bonds went up, and that was only by one lousy penny to what it was on Wednesday.

I would really like to buy more Vanguard equity funds at these prices, but if I try to buy now I think it will be at the prices at Monday's close, not today's close. With my luck the market would pop back up Monday - - that's what happened to me the last time I tried to be clever like that.
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Old 06-06-2008, 05:47 PM   #145
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I am supposed to VCA into my taxable account on Monday. Right now my spreadsheet is telling me to buy international equities, US large caps, and US bonds and to stay put on REITS, US small caps, cash and foreign bonds. The position which needs the most support right now is emerging markets (VEIEX for me). The position which needs the least support is US small caps (I aggressively added to that position between 11/2007 and 04/2008 ).

Down 1.6% today.
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Old 06-06-2008, 06:03 PM   #146
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Even with a very conservative portfolio, I figure to be down 0.7% today. The only saving grace is that I estimate to be about even since Memorial Day.
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Old 06-06-2008, 06:03 PM   #147
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If you adjust your plan now based on whatever dire news you perceive, you will be guaranteed to underperform long term. So ditch your plan at your own peril.
If you are in AA, you have to work your plan. That has been proven over and over. And probably the same if you are getting up every day and have to go out and sell some life insurance.

But I really don't know where it is proven that the only way for a retired person to invest is to buy and hold a random assortment of stocks.

Why should it be so? It may work, and it may not. Your statement about today being better than the 70s or the early 30s is true-so far.

BTW, see my post from yesterday:

Current Dow Industrials Technical Position

I do hold a lot of equities, but the dividend yield is enough that I shouldn't have to make any withdrawals. Still not great; I cannot see why any retired person would want her portfolio to lose quoted value, unless her partner is still working or she is receiving cash inflows from outside the portfolio.

Ha
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Old 06-06-2008, 07:22 PM   #148
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Year to date, down 2.3 as of tonight. Down 0.27 percent since yesterday, thanks to 63 percent of portfolio spread equally among money market, bond index fund, and target 2010 retirement fund, which were virtually unaffected by today's drop.

Since January 1, I have moved some money into bonds and money market from international, large cap blend, and small-midcap growth funds so only have 22 percent of portfolio spread among those. Remaining 15 percent is in Wellington. We will probably stay at this allocation well into retirement, which ideally is 30 months away--but there could be a forced retirement sooner, and this is the risk level we can sleep with.

(Why, yes, Milton, I am well aware that a preposition the preceding sentence ended with.)
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Old 06-06-2008, 07:23 PM   #149
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My portfolio took a nice nose dive today. Not the kind of discount I enjoy.
What is your investment time horizon? One day? One week?

Getting bent out of shape over a single day tumble is ridiculous. At the very least, it is a good indicator your portfolio is not well matched to your need, ability, and willingness to take risk.

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And I will adjust my portfolio as I see fit.
I hope that doesn't mean selling low and bailing into cash/bonds at this point, but rather following your predetermined plan and not modifying it because a single down day in the market.

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But I really don't know where it is proven that the only way for a retired person to invest is to buy and hold a random assortment of stocks.
Not sure what you mean. I hold index funds, is that what you are getting at?

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I do hold a lot of equities, but the dividend yield is enough that I shouldn't have to make any withdrawals. Still not great; I cannot see why any retired person would want her portfolio to lose quoted value, unless her partner is still working or she is receiving cash inflows from outside the portfolio.
Nobody wants to lose any value - but when you are in the market that happens. You can't have return without risk. Even for a retired person, the portfolio time horizon is not and should not be one day, or one week, but rather the same long-term view.

It sounds like you are of the school of 'spend the dividends, don't touch the principal'. I subscribe to total growth of the portfolio theory (with rebalancing).

I use a proper bond allocation to balance my risk tolerance, rather than trying to own nondiversifiable risk through individual, dividend-paying equities. I suspect I'll be doing the same when I retire.
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Old 06-06-2008, 08:41 PM   #150
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What is your investment time horizon? One day? One week?

Getting bent out of shape over a single day tumble is ridiculous. At the very least, it is a good indicator your portfolio is not well matched to your need, ability, and willingness to take risk.


Bingo. Screw stocks.
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Old 06-06-2008, 08:53 PM   #151
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But I really don't know where it is proven that the only way for a retired person to invest is to buy and hold a random assortment of stocks.

Why should it be so? It may work, and it may not. Your statement about today being better than the 70s or the early 30s is true-so far.

BTW, see my post from yesterday:

Current Dow Industrials Technical Position
Great points and great call. I sure didn't see this one coming.
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Old 06-06-2008, 08:59 PM   #152
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Bingo. Screw stocks.
I mostly feel the same way until valuations are reasonable which may or may not happen. The CPI fudging plunge protection team is working hard to see that it doesn't . Feeling that way I'm always looking for alternatives, let us know if you come across any new ideas.
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Old 06-06-2008, 09:06 PM   #153
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The stock market sucks and SPIA's ROCK! I am getting seasick and sick of the whole schelmeel.
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Old 06-06-2008, 09:11 PM   #154
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The stock market sucks and SPIA's ROCK! I am getting seasick and sick of the whole schelmeel.
SPIA's do not Rock. They are marginal alternative investments (somewhat interesting) as I see it. The stock market at PE's over 20 includes significant (historically based) risk, that doesn't look too hot either. I do not like to lose money, but that's just me.
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Old 06-06-2008, 09:14 PM   #155
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Heh. Its one down day in the past how many years of positive gains. Maybe some people need to rethink their AA.
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Old 06-06-2008, 09:15 PM   #156
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The stock market sucks and SPIA's ROCK! I am getting seasick and sick of the whole schelmeel.
It's not like they're going to be down FOREVER, y'know.... and besides, the main function of stocks (for me, anyway) is just to combat the effects of inflation on my portfolio, not to live on.
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Old 06-06-2008, 09:19 PM   #157
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.... and besides, the main function of stocks (for me, anyway) is just to combat the effects of inflation on my portfolio, not to live on.
Now that's an interesting view, I appreciate the concept. I doubt that view is shared by many on this Forum though.
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Old 06-06-2008, 09:23 PM   #158
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Old 06-06-2008, 09:25 PM   #159
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Pssst - Wellesley = current yield 4.24% or a tad higher than the mighty mighty 4% rule.

heh heh heh - just thought I'd mention it. And I can still get by on my Target retirement 2015 at 3.05% in a hard times mode.

And and those Vanguard computers rebalance away - whether I laugh or cry. . Carry on!
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Old 06-06-2008, 09:33 PM   #160
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Pssst - Wellesley = current yield 4.24% or a tad higher than the mighty mighty 4% rule.

heh heh heh - just thought I'd mention it. And I can still get by on my Target retirement 2015 at 3.05% in a hard times mode.

And and those Vanguard computers rebalance away - whether I laugh or cry. . Carry on!
Can't argue with that. I always enjoy your bits of wisdom. I haven't been around long but it always sounds like you actually walk the talk.
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