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Old 08-09-2011, 02:28 PM   #61
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From the peak I'm down 12% and bought more in a rebalance yesterday. But the gains before the peak were twice that in 12 months and I had just rebalanced in July taking some off the table. You have to have a strong stomack but riding through and rebalancing at high points and low points sure gives it a kick! I don't think it's over but you have to have faith.
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Old 08-09-2011, 02:36 PM   #62
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It doesn’t bode well for the economy that the Fed just came out with a decision to keep interest rates "exceptionally low" until mid-2013.
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Old 08-09-2011, 04:18 PM   #63
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For the first time in my life, I lost a 6-figure amount in just one day. I'm feeling proud of that accomplishment.
Yea... I made that club also.... and to think that it took a month to do it during the 2008 crisis...

Hope to cut at least half of that loss by the end of the month....
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Old 08-09-2011, 04:34 PM   #64
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It doesn’t bode well for the economy that the Fed just came out with a decision to keep interest rates "exceptionally low" until mid-2013.
Wouldn't this help the bond market?
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Old 08-09-2011, 04:48 PM   #65
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Wouldn't this help the bond market?
True, but the bond market is not the economy. If it were, we wouldn't have 10% unemployment after 3 years of rock bottom interest rates and strong bond prices.

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Old 08-09-2011, 05:16 PM   #66
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At the time we moved our 401k funds over to a USAA Flexible Savings Annuity IRA we got a 2% bonus on the rollover amount and have a guaranteed 4% annual earnings compounded daily. We missed the 3% bonus and the higher interest rates by a few months (darn it!); but, are glad not to have to worry about it any more. (ETA: The first year was even better that 6% (2% bonus and 4% annual earnings) since the bonus was applied up front and got the full annual benefit of the compounded interest.)

That being said, the bonus and the annual rate have fallen since then. Bummer. (ETA: did not impact us - only new folks).
Is the 2% bonus only for the first year? So 6% for the first full year and 4% thereafter?
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Old 08-09-2011, 06:06 PM   #67
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How bad a hit did you take this week ?

Well, let's just say my idea of purchasing a new Mustang GT (412hp) with 6 speed manual is on hold indefinetly.
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Old 08-09-2011, 06:06 PM   #68
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Is the 2% bonus only for the first year? So 6% for the first full year and 4% thereafter?
Kind of. When we first signed up, the bonus was just for the initial deposit. Right after that the program allowed the bonus to be applied to all deposits made within the first year (doing this from memory). Then the rates fell and the bonus amount was reduced. The rates should improve when the Fed finally... well.. that's another story.

I digressed. If you do the pure math, the first year is a bit more than 6% because the bonus is applied the day of the deposit. Let's say I moved $500,000 from my 401K over to the Flexible Retirement Savings Annuity. I immediately got $10,000 for the bonus (free money). My starting number is now $510,000. The 4% starts on that number. Since the annual rate is compounded daily, the bonus starts getting earnings right away.

The second and subsequent years earn the 4%. Again, it's compounded daily. Sweet.
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Old 08-09-2011, 06:17 PM   #69
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I am down about 8% from the recent peak - with about a 55/45 AA. Not fun! Staying with the plan - have about 2 years cash. I'm not to worried, but, hate to see the net worth fall. Gotta play to win in the long term.
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Old 08-09-2011, 07:18 PM   #70
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At present, I am off 4.5% on a 79% stock portfolio, from the high-water mark before the start of this mini-crash through today's close. The other 21% is CDs.

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Old 08-09-2011, 07:24 PM   #71
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After today, I'm up a measly 2% for the year in my personal trading account; down 3% in my 401k for the year...

I got tons (75%) in mm, cd & such.

Peak to now, down 6% in personal & 6.3% in 401k...I've been buying on the way down over the week...including adding to my S&P holdings at end of day yesterday...gave me a nice bump today, hope it hangs in there.
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Old 08-09-2011, 07:30 PM   #72
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Down 4.9% yesterday, probably recovered more than half of that today.

My retirement plan was to rebalance every 12 to 18 months if my AA shifted 5%. I am now off by over 5% in my AA and I only rebalanced a few months ago. Not sure if I should go with time or % bands for rebalancing, this never happened so fast to me.

Any ideas if it is better to rebalance on % changes regardless of the duration?
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Old 08-09-2011, 07:36 PM   #73
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Down 4.9% yesterday, probably recovered more than half of that today.

My retirement plan was to rebalance every 12 to 18 months if my AA shifted 5%. I am now off by over 5% in my AA and I only rebalanced a few months ago. Not sure if I should go with time or % bands for rebalancing, this never happened so fast to me.

Any ideas if it is better to rebalance on % changes regardless of the duration?
Hey neighbor!

I would re-balance with the correction happening. I look at the probability of it continuing vs. re-bounding a bit...I give it a 5% downside vs. 20% upside...
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Old 08-09-2011, 07:45 PM   #74
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I could have bought a Dodge Viper (used) with the drop in valuation of my IRA. However, if you do not sell, you do not lose. And the dividends still keep coming.

I do not know what good an interest rate of zero will do. The banks still will not lend money.

Fasten your seat belts. There is more to come.
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Old 08-09-2011, 09:00 PM   #75
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I do not know what good an interest rate of zero will do. The banks still will not lend money.
Good point.
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Old 08-09-2011, 11:07 PM   #76
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I can suffer through another week or two before I rejoin the club.
Turns out we got off for a lousy $400K. $150K have already returned and I'm I hope the stuff I bought on the downtrend will get us to 0 before the ones who said WTF.

All I know is that I ER'd in June 07 and today our NW is 135% of when I ER'd. That includes our withdrawals. Our AA may not be conventional, but so far it has worked.

YMMV, of course.
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Old 08-09-2011, 11:17 PM   #77
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Turns out we got off for a lousy $400K. $150K have already returned and I'm I hope the stuff I bought on the downtrend will get us to 0 before the ones who said WTF.

All I know is that I ER'd in June 07 and today our NW is 135% of when I ER'd. That includes our withdrawals. Our AA may not be conventional, but so far it has worked.

YMMV, of course.
I'd say you are a champion. What is your unconventional AA?

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Old 08-09-2011, 11:48 PM   #78
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About 35% in former mega-corp options. They (or the under-lying stock) tend to be volatile.
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Old 08-10-2011, 05:00 AM   #79
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One of the things that comes up when discussing market psychology is the different reactions between losing money and gaining money.

Most of the time when you give a somebody a meaningful amount of cash and then offer them a chance to double it or lose it, will turn down the opportunity to double up, because the pain of losing is less the joy of winning.

On Monday I "lost" > $123,000 and Tuesday and "won" >$115,000. The $8K difference over two days normally wouldn't even get my attention. Since they were back to back days, I am amazed at how much worse I felt on Monday, than better I felt on Tuesday.

I can now see the benefits of ignoring the market and only checking portfolio's twice a year. Fortunately/unfortunately as retiree and news junkie I don't see how this is possible for me. But it would definitely reduce stress levels.
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Old 08-10-2011, 06:08 AM   #80
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Down 2.7% for the year after 8/9/2011 with a 60/40 401k.
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