How About Just Sitting Tight (and Having a Cocktail)?

[Mo Money]

So much talk right now about buying low, when a low cannot be predicted. I totally respect the strategy of buying low and selling high, and using reserved cash to buy into the market after a plunge. I just think that I'm not one of those people.

For those like me who have a multi-year reserve of cash and bonds, I am not inclined to use that money to buy into the stock market at a time when I literally have to guess that the market is at or near a low. I will instead use that money and fixed income to ride out any storm.

A lot of what I'm seeing on this board right now is a take-the-cash-out-of-mothballs-and-invest mentality.

Is anyone else just sitting tight?

 

[Andre1969]

I've bought a little here and there, but only because the market has fluctuated enough to throw off my asset allocation, so I've re-balanced.

 

[Beardog]

I always just sit tight. No market timing for me!

 

[stephenson]

Hey Mo,

I am and have been a sit tight kinda investor ....doesn't mean I don't try and take advantage of market fluctuations ...but never at the level that constitutes much more than mad money ...I think the bottom is tough to call, but in this current market, looking at the widespread growth and positive signs across consumer numbers, real estate, car sales, etc, I personally believe this is a distinct blip ...but, a blip.


Sent from my iPad using Early Retirement Forum

 

[frayne]

Sitting tight has always worked for me, during the tech bubble and in 2008. Don't worry about something you can't control. If you have a solid AA just sit back and watch the show.

If you have extra cash on the sidelines and you feel like jumping in, be my guest.

 

[REWahoo]

Is anyone else just sitting tight?

<Hand goes up>

Might do some rebalancing if appropriate, but otherwise I'll be sitting on my hands, hoping the worst is over with quickly.

 

[Spanky]

"Is anyone else just sitting tight?"
We are standing by and may put some money in when AA is significantly out of balance.

 

[H2ODude]

Only thing I'm considering (and I may make the decision later today as I'm all M funds) is to hold my nose and convert some of my tIRA to Roth. I was working in 08-09 and just stood pat through all the carnage. Worked pretty well.

 

[Dawg52]

With future down 600+ points at this moment, might as well sit tight. Actually about to go play golf, so no sitting. As others have said, will rebalance when appropriate.

 

[Zathras]

We are sitting tight, mainly because we are not in the acumalation phase.

During the last downturn we did buy in as the market descended. Most people that do this will spread out their purchases. They aren't going all in when they think they are at the low point, they just make a number of purchases.
This way the DCA to take advantage of the sale.

 

[jim584672]

E*trade baby looking at the action today...

 

[Bestwifeever]

I would guess most people here sit tight and just aren't as vocal as the "might buy" posters (not a criticism of them, hope they do well).

Now I am going back to bed and pulling the covers up over my head for a week.

 

[Rickt]

Sitting tight here.....have no intention of catching a falling knife. Will buy a little with 7% cash balance when the dust settles.

 

[MrLoco]

Here' the way I look at it. If you have some "spare" cash available, and you don't mind nudging your AA to overweight stocks by 2-3% of your overall allocation, why not look to buy now or within the next few days?

I think there is a little bit of "market timing" in all of us. The DOW hit an all time high of 18,312 on MAy 19 of this year. So even if this in NOT the bottom, and you invested at the close today( assume round 16,000 if the futures for today prove correct), you would still be buying at a 12% discount over the high in MAy EVEN IF we are no where near the bottom.

Sure the DOW may end up settling at 10,000 or 12,000 but so what/ At least you didn't buy at the all time high and this is (was) money you had on the sidelines and don't need for at least a 10 year period. Just my 2 cents.

 

[O2Bfree]

I'm still working and have a lump of cash, so I'll probably do some buying. If it drops further, oh well.

Coincidentally, I opened a Vanguard account late last week, and am waiting for my funding transfer to clear. (I'm currently with Fido through my workplace, but have been admiring some of Vanguard's funds.) Looking forward to jumping into the Vanguard pool with the rest of you!

 

[jollystomper]

I'm in OP's camp. I have enough cash to not have to touch equities for 6-7 years after I retire. I am just going to continue LBYM and my monthly 401K/onn-401K contributions as usual.

 

[Midpack]

<Hand goes up>

Might do some rebalancing if appropriate, but otherwise I'll be sitting on my hands, hoping the worst is over with quickly.

+2, as always. I probably wouldn't be retired today if I hadn't given up on market timing 30 years ago...

 

[Fermion]

It was very hard not to buy yet. When I logged on this morning, Gilead was trading for $95, Apple for $90, Corning for like $15!

All three of these were trading at trailing, forward PE under 10...I think some were approaching 7 or 8 PE.

By the time I removed my jaw from the floor they had recovered in price somewhat.

 

[nun]

I'm doing some rebalancing, so selling Total Bond Index and buying Total Stock Market Index.

At times like these I'm also glad of my TIAA-Traditional and its current 4% return

 

[Katiek]

Since I'm still working, I "buy" through my 401(k) and regular investments with each paycheck, but otherwise I'm sitting tight. My asset allocation is within my desired range (I got better at that after 2008) and although the headlines and news makes me a bit angsty, I'm reminding myself to stay calm and stay put.

 

[marko]

As I've noted on other threads, I'm using this drop as an opportunity to "go back in time" and buy a stake in an S&P index fund; something I should have done a year ago but didn't.

Now it is September 2014 all over again. Of course, I'm betting on the S&P regaining itself, but I'm pretty confident.

I view it as that "missed boat" coming back to pick me up.

 

[audreyh1]

It would have to drop quite a bit to force me to rebalance. I hate rebalancing in Q4 when I get a bunch of distributions. If it happens sooner and reaches my threshold, I am obligated to rebalance.

I hope folks who had limit orders waiting for a drop don't regret they didn't wait for lower prices.

 

[Theseus]

Being an optimist, I'd say the dividend yields on equities are pretty attractive this morning. Having enough cash reserves set aside to sit out 5 years, I have little reason to be pessimistic. As long as I don't squander cash on a too early bargain hunting spree that is.

 

[Moemg]

I am sitting tight . I learned my lesson in 2008 -2009 . These drops do knock me into a somewhat more frugal mode but otherwise life as usual .

 

[nun]

As I don't use my stock and bond investments for income I just do my usual rebalancing whatever the situation.

At times like these living off pensions, annuities, SS or rent makes it easy to sit tight. However, if you are recently retired, didn't build in enough of a fixed income/cash cushion and have to sell into a prolonged downturn it could be nasty.