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Old 09-30-2008, 01:29 AM   #21
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I'm not at my allocation goal.
I did put $850 in the market today and 4K on fri - 3K in foreign small stocks.
I'm still averinging into the market.
What do you use for small cap foreign equities?
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Old 09-30-2008, 02:51 AM   #22
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I am actually in much better shape than I thought. In my own accounts I am down 10% from my all time post-divorce high water mark of 10/2007. About 3% of that is living expenses. I am about 90% in equities, though much of that is recenty committed. Too early to be sure, but it is hard to get it exactly right.

I think those who own good stocks at today's prices will be well rewarded.

I expect to be much richer one year from now. If capital is in short supply, firms with excess capital will do very well.

Those of you who are worried about another great depression should read JM Keynes book-I have it at my old house but I can't remember the volume# right now. He made a lot of money during the so called great depression, going long on beaten down stocks. Something is always making money. Our goal as investors is to stay solvent, invest in strong businesses, and don't respond to head-fakes.

It helps to be well enough capitalized that you can live off reasonable dividends thrown off by your stocks, rather than needing to trade them.

And if you are still working, this is a nice set-up for you.

Ha
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Old 09-30-2008, 04:18 AM   #23
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0% equities, have been for awhile. Just watching all this from the sidelines.

I subscribe to the idea that the mid to late 90's were a once in a lifetime boom, they got ridiculously overpriced, and it's going to take a long time to work off the excesses (and thus stocks become investable).

So far....the S&P has been flat for 10 years. You haven't missed much.

The risk/reward is still out of whack...nominal upside (maybe a few percent more than cash?). But automatic, 10-12% a year gains...long gone.

And the downside is still a lot. There are going to be rallies, but it's going to be 5-10-15 years of choppy markets, at least. Same cycle as 20's to early 50's, and mid 60's to early 80's. The public jumped into stocks, and it took 20-25 years to break even.

although im a big believer in being well diversified and i doubt ill ever pull out i tend to think you maybe right in your prediction and while id love to give you a good argument for why you shouldnt be out i really cant argue with you. you just may be right.
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Old 09-30-2008, 04:44 AM   #24
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80% equities and heavily invested in financial stocks. So it has been a very interesting last 12 months. I've only had one dividend cut so I'm not too concerned, still it isn't fun to see my net worth drop by my peak annual salary in a single day.
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Old 09-30-2008, 08:00 AM   #25
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I am expecting another bloodbath today, after which i intend to move 10-15% of my portfolio from bonds into equities (currently about 50/50). I expect to retire in 5 years, and believe I be be well ahead by then. Yes, I believe that I am aggressive. I was 90/10 until about October of last year when I moved to 60/40 due to the overvalued market. Yes, this is market timing.
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Old 09-30-2008, 08:15 AM   #26
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Had been 60% equities but moved that up to 70% yesterday (added more VTI, VYM, GE, MO). Plan to increase equities if market continues to drop.
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Old 09-30-2008, 08:15 AM   #27
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But for those of you hoping to RE in 5 - 10 years and have substantial assets already accumulated, this may not be the boon you're thinking it is....... But I hope it works out OK for all!
Yeah, I may be needing to change my signature line soon.

Oh well, it was a young dreamer's aggressive, hopeful goal. We are about 75% equities. Staying the course and just accepting we may end up working longer than we had hoped.
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Old 09-30-2008, 08:17 AM   #28
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Increasing my equities stake as I can.
Very happy with this years performance as my income from the portfolio has increased allowing my to buy more dividend paying equities (one dividend cut, many increases).
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Old 09-30-2008, 09:03 AM   #29
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Well - first of all, I never considered myself an aggressive investor since I am not in the accumulation stage - rather the drawdown stage with a long time horizon.

Nevertheless, with this "crisis" my gut instinct has been to leave the portfolio alone even though it contains 58% equities (or well, it DID a few days ago), and just do the occasional rebalancing. I seem to be OK with just letting the investments ride.

It's the short term funds that's got me taking action. With all this upheaval I've got to make sure my "bucket" holding the next 2 to 3 years in cash is solid and protected. Fortunately, the FED is guaranteeing my money market funds for the next year, supposedly, but I'm looking at ways to make things more officially insured. I don't want a sudden interruption in my short term cash flow.

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Old 09-30-2008, 09:15 AM   #30
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It's the short term funds that's got me taking action. With all this upheaval I've got to make sure my "bucket" holding the next 2 to 3 years in cash is solid and protected. Fortunately, the FED is guaranteeing my money market funds for the next year, supposedly, but I'm looking at ways to make things more officially insured. I don't want a sudden interruption in my short term cash flow.
I know what you mean. I watch over my mom's money, and a couple weeks ago I moved about $150K in her account from one standard money market fund to a Treasury money market fund. We lose about 0.6% in yield, but you know what they say -- there are times when return OF investment is more important than return ON investment...
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Old 09-30-2008, 09:30 AM   #31
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Yep, I actually transferred > 6 months worth of cash needs into our FDIC insured bank account which pays absolutely nothing and was set up that way for it's low minimum/no fees for just covering 1 month's worth of expenses. I guess I'll go open another account there that might at least pay us SOMETHING. I don't want any interruptions in the ol' cash flow....

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Old 09-30-2008, 09:57 AM   #32
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We moved more into cash over the past two years due to info I gained here. I had previously been about 90% equities but with DW planning to stop work next year we needed a substantial cash bucket to be able to outlast extended downturns. This downturn is effectively making our cash bucket a bigger part of our portfolio.

Edit: I haven't even considered pulling equities out as things have fallen. In fact I have regretted the need to maintain the cash and not utilize this buying opportunity. If we hit a truly epic catastrophe I will end up merrily spinning down the drain saying "what goes down must come up." I would rather take that chance than bail at the bottom as flocks of people do.
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Old 09-30-2008, 09:59 AM   #33
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how many have changed their minds over the last few weeks about whether they are truely aggressive investors who are usually 70-100% equities?...im glad that over the last few years i shifted from 80-90% equities to my 45-50% and sleep a lot better for it.
I'm feathers and eggs all the way.
how many dozen would you like today?
i did the final shift to a 50-50 AA right after i FIREd in spring 07. i had been at 60/40 during the salt mine years. so no change here.
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Old 09-30-2008, 10:17 AM   #34
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I have 20-25 years before I will have to take money from my accounts. I enjoy watching the panic. Each time we get a panic drop I invest more funds or rebalance my allocation of assets. This may well turn out to be the best investment opportunity of my life.

I was surprised to find the market drops have no effect on my investment psychology. I expect that is due to investment knowledge and several books and accounts of market madness.

I'm about 70% equities and 20% of that is in Oil and Gas stocks

I found "A Short History of Financial Euphoria" by John Kenneth Galbraith very enlightening.
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Old 09-30-2008, 10:22 AM   #35
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Need to check to see, probably time to rebalance... although we've been adding so much to equities that I might have offset percentage losses. Still shooting for 80/20.

I don't count my cash position since that's slated to near-term planned expenses (moving and building a house at some point) but I can't say I'm not tempted to dip into that and throw a slug into the market. I'm as confident of it going up as down, so I do nothing.
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Old 09-30-2008, 12:05 PM   #36
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I'm half retired (DW didn't feel like quitting yet). I'm 100% equities by AA, though with some foresight I pulled out about 20% cash throughout last year to ensure my first few years of retirement weren't hit with a bear market. About 9% of that has gone back into equities as the market dropped, with 6% more to go.

My retirement simulation shows I'm short of portfolio value right now if I use nominal rates of return. I need to boost returns by 2% to get back to a retirement surplus. That seems pretty reasonable given the current market price. I think we'll see much better than 6% returns from this point. That seems pretty much the point Ed Easterling was making with his talk of better expected returns when P/E is low.

So sure it's a little uncomfortable, but it's also a nice opportunity and within my expectations.
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Old 09-30-2008, 12:34 PM   #37
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I went from 90 to 95 in equities during the last drop. I missed out yesterday (bummer) and now the markets have slightly rebounded. On the next drop, I'll probably move more over to equities. I'd go full 100%, but I need to keep some bonds due to restrictions on some of my accounts.

All in all, for those of us who have time to wait this out, this is a great opportunity.

At moments like this, I go back to what Bernstein said in Four Pillars that for accumlators, pray for a bear market. Prayers fulfilled. Now let's just hope it pans out.
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Old 09-30-2008, 12:47 PM   #38
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I'm half retired (DW didn't feel like quitting yet).
It's my dream to be able to say the exact same thing some day...
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Old 09-30-2008, 05:30 PM   #39
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although im a big believer in being well diversified and i doubt ill ever pull out i tend to think you maybe right in your prediction and while id love to give you a good argument for why you shouldnt be out i really cant argue with you. you just may be right.
Also, I think we're in a commodity up cycle of 10-15-20 years, that started in 98/99. That won't be good for stocks.

Supply shrank in the 80's and 90's, excess inventories got worked off, there was little incentive to invest in productive capacity with prices declining. But demand kept moving along, and ultimately the cycle is reversed.

Old books on the market crossed me over to 0% stocks, like Money Game (about the market in the 60's). All the ticker symbols and "gurus" in the book are long forgotten. They thought it was "different", stocks always go up, etc. I think everyone is going to get fooled in this market...the landscape supporting stocks is going to change.
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Old 09-30-2008, 05:46 PM   #40
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I'm about 60% equities (or was). 5% cash. Have decided to continue to DCA by asset allocation but will be reducing the monthly amount and focusing on value. Goal is to build up a bigger cash reserve. If not needed, I'm sure there will be opportunities to invest it. Sure am glad that I added some real estate. ER might not be so E.....
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