January was a real kick in the teeth!

[MrLoco]

Down 5% = $170,000. I know....stay the course......5% is a blip on the radar, what if it becomes 50%, etc.,etc.
I think the shock is it happened so fast right at the start of the new year.
MAybe I need to see the glass half full>maybe this is a buying opportunity?

 

[papadad111]

Broad Market sp500 is down 14% from the last highs. That's how I measure how far I'm down.

I am replicating ... Down about that same amount with a 90/10 equity/cash AA but 20 percent international which is down more than SP500

By the way.... The percent or Amount I'm up or down from an arbitrary date such as Jan 1 / beginning of the year is irrelevant... Picking a date is a mind trick, so I never look on an annual basis. I care more about where I am versus prior "my all time high score" ... Never reset the bar ...

 

[Senator]

If I had individual stocks, I would be more worried. I am down about the same as you, maybe a bit more, although I am still in the buying mode. I purchase the same ~11K a month, sometimes slightly more.

Individual stocks can go to $0, no matter how big the company is. Indexes likely not. It is probably NOT different this time.

IVV, IVW, IWM, QQQ, DVY are my main holdings. If they go to $0, I have guns and bullets.

 

[NW-Bound]

If I had individual stocks, I would be more worried...

Yes. If you have individual stocks or concentrated sectors, sometimes you beat the market, sometimes the market beats you.

PS. Individual stocks or sectors that have high "beta", meaning being more volatile than the market, may move twice or more as much as the market. I have been watching biotech, and they have been beaten down bad. At some point, the price will become irresistible, and I will have to bite. Bear markets are the time good money is made.

 

[MichaelB]

Down 5% = $170,000. I know....stay the course......5% is a blip on the radar, what if it becomes 50%, etc.,etc.
I think the shock is it happened so fast right at the start of the new year.
MAybe I need to see the glass half full>maybe this is a buying opportunity?

A 5% decline can happen anytime. If "what if" bothers you that much, perhaps you should reduce your equity allocation to a level that lets you sleep more easily.

 

[Corporateburnout]

IVV, IVW, IWM, QQQ, DVY are my main holdings. If they go to $0, I have guns and bullets.

Why guns and bullets when you have a pension, SS and tons of rentals and as Rodi said "you have income coming out of your ears"

 

[wrl11]

Just don´t sell when they are down. Good job adding more down. So hard to do when losing money (and likely to lose more near-term) but you will never call the bottom and the market will be 50% or more higher before average investors are comfortable buying stocks again, completely missing the biggest moves of the next bull market. I did all the wrong things in the 2000-2003 drop and vowed never again. I did not sell in 2008 but did not buy much either, so trying to do it right this time.

 

[marko]

Down 5.22% from a flat '15. Ugh! Bought a little last week.

Hanging tight, staying calm, carrying on.

 

[Senator]

Why guns and bullets when you have a pension, SS and tons of rentals and as Rodi said "you have income coming out of your ears"

Always need a contingency plan... I just checked my ears, no $$ today... I'll check again tomorrow.

I am getting close to FIRE, just a few days (146) left. Another milestone on Friday when I get one of my two bonuses this year.

 

[calmloki]

In the adjustment of point of view vein.... if your 5% loss = $170,000, doesn't that mean you still have over $3,200,000 moldering away in the stock market? Some might view that as a rather enviable position in which to be. As in, you probably won't have to sell plasma to buy a tank of gas for the old Corolla.

 

[btdt22]

[FONT=&quot]From the Whitecoat investor[/FONT]:


"[FONT=&quot]If you find yourself worrying about all the money you lost in a downturn, this is probably a great time to improve on your financial education. I would suggest starting with a review of stock market history. You will quickly see the stock market drops by 5% or more about three times per year, by 10% or more (a correction) about once per year, and by 20% or more (a bear market) once every 3-4 years…."[/FONT]

 

[Corporateburnout]

Always need a contingency plan...

Guns and bullets are my contingency plan if I'm diagnosed with Alzheimer or a terminal illness but never for the performance of the stock market......

 

[dixonge]

Just don´t sell when they are down. Good job adding more down. So hard to do when losing money (and likely to lose more near-term) but you will never call the bottom and the market will be 50% or more higher before average investors are comfortable buying stocks again, completely missing the biggest moves of the next bull market. I did all the wrong things in the 2000-2003 drop and vowed never again. I did not sell in 2008 but did not buy much either, so trying to do it right this time.

I did all the wrong things in 2000-1 as well. Also 2008. Also...ok, I'm going to stop there before I get depressed. lol

 

[JoeWras]

Met some extended family members recently and they are freaked out over this and sold all but 10% of their holdings.

I've still been adding, including some in January and February. I have to say it takes some nerves of steel to do so.

 

[easysurfer]

Might be easier said than done, but change the mindset to look in terms of shares than dollars. Shares are getting cheaper to buy .

 

[W2R]

I have a very high strung, nervous temperament about most things, but not about investing. I can't afford that luxury.

In addition I am sure it helps a lot that I have several different income streams that are independent of market conditions. As my dear departed mother would have said if in similar circumstances, rolling her eyes, "This wasn't by accident, you know!"

Still, over 50% of my spending money DOES come from my portfolio, so I keep an eye on it. To be honest, this just seems like nothing after going through 2008-2009. On March 9th, 2009, the Dow Jones hit 6443; yesterday it hit 16014. The market could become just as bad as it's 2009 low, or worse! I'm not saying that it won't because I have no idea. But it's not there, and for me this dip is just so insignificant thus far.

I came out of 2008-2009 with a somewhat larger portfolio than previously because I bought low instead of selling. This time, if the market plunges just as far, I won't have as much cash to spend buying low. Still, I think I would be just fine as long as I don't sell.

 

[Options]

A 5% decline can happen anytime. If "what if" bothers you that much, perhaps you should reduce your equity allocation to a level that lets you sleep more easily.

+1

I have a very high strung, nervous temperament about most things, but not about investing. I can't afford that luxury.
...

+1
Emphasis added

 

[TallTim]

Bothers me a lot less than it did pre-FIRE, oddly enough.

We set things up w 12 mos expenses + one year of college tuition in more or less cash or cash-equivalents ... and the rest in a range of investment vehicles. So it's down, but nothing we need to access for 12 mos (or maybe more).

Even though its only been ~ 6 mos, the lesson so far on spending and mkts for me and DW has been that the plan will be OK.

 

[W2R]

Bothers me a lot less than it did pre-FIRE, oddly enough.

Yeah, same here! Before retiring, it could have delayed my retirement. Now, if the worst happened then I'd still be retired and just cutting back a whole lot on my spending.

 

[Corporateburnout]

We set things up w 12 mos expenses + one year of college tuition in more or less cash or cash-equivalents ... and the rest in a range of investment vehicles. So it's down, but nothing we need to access for 12 mos (or maybe more).

+1. We maintain 3+ years of spending in cash, I-bonds and short term bonds to ride out market downturns.

 

[ESRwannabe]

Well I guess its a good thing I'm a very stubborn person. When my investments go down it doesn't scare me... it does piss me off though. The market is simply wrong, I'm the one with the right ideas.

 

[roninop]

Been bouncing around 4 - 6 % loss since mid 2015, but still up around 300K from
2014. I started selling some winners around DOW 14,000 in anticipation of retirement
and to lock in some gains from the great recession. I feel good we are out of some
higher risk investments and went from 70/30 to 58/42, also, built a 3 + year cash position in the event we experience a significant downturn. I'm neither buying or selling at the moment, just staying the course like I've been taught. Eventually, hope to further reduce to 30 % or so stocks. The need to take risk is diminishing every year.

 

[Car-Guy]

Guns and bullets are my contingency plan if I'm diagnosed with Alzheimer or a terminal illness

In such a case, you should only need one of each.

 

[ziggy29]

+1. We maintain 3+ years of spending in cash, I-bonds and short term bonds to ride out market downturns.

Yeah, this is sort of a "buckets of money" approach. If you make sure you keep several years of living expenses in "safe stuff", it's easier to weather the bear markets, drawing down the cash and "cash-ish" stuff for expenses, and waiting for the market to recover so you can replenish that bucket.

 

[ripper1]

I have a very high strung, nervous temperament about most things, but not about investing. I can't afford that luxury.

In addition I am sure it helps a lot that I have several different income streams that are independent of market conditions. As my dear departed mother would have said if in similar circumstances, rolling her eyes, "This wasn't by accident, you know!"

Still, over 50% of my spending money DOES come from my portfolio, so I keep an eye on it. To be honest, this just seems like nothing after going through 2008-2009. On March 9th, 2009, the Dow Jones hit 6443; yesterday it hit 16014. The market could become just as bad as it's 2009 low, or worse! I'm not saying that it won't because I have no idea. But it's not there, and for me this dip is just so insignificant thus far.

I came out of 2008-2009 with a somewhat larger portfolio than previously because I bought low instead of selling. This time, if the market plunges just as far, I won't have as much cash to spend buying low. Still, I think I would be just fine as long as I don't sell.

W2R, can't wait until I see your WHEEEEE post again