Join Early Retirement Today
Reply
 
Thread Tools Search this Thread Display Modes
Old 02-11-2013, 11:15 AM   #21
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
audreyh1's Avatar
 
Join Date: Jan 2006
Location: Rio Grande Valley
Posts: 16,471
Quote:
Originally Posted by Lsbcal View Post
This is a good point and got me to do some homework.

We are not currently at a new high in the SP500 when one includes dividends and inflation. The last high was in August 2000 and we would have to be about 7% higher to reach this.

Since 1951 based on monthly data, we have had an average of 22% of those months being monthly highs. So monthly highs are not really very rare, but note they do tend to cluster.
We haven't breached the 2007 (unadjusted) highs either - intraday of 1565.15 and closing high of 1530.23.
Quote:
On May 30,2007, the S&P 500 closed at 1,530.23 to set its first all-time closing high in more than seven years. The highest level reached was 1,565.15 on October 9, 2007.
from Wikipedia.
__________________

__________________
Well, I thought I was retired. But it seems that now I'm working as a travel agent instead!
audreyh1 is offline   Reply With Quote
Join the #1 Early Retirement and Financial Independence Forum Today - It's Totally Free!

Are you planning to be financially independent as early as possible so you can live life on your own terms? Discuss successful investing strategies, asset allocation models, tax strategies and other related topics in our online forum community. Our members range from young folks just starting their journey to financial independence, military retirees and even multimillionaires. No matter where you fit in you'll find that Early-Retirement.org is a great community to join. Best of all it's totally FREE!

You are currently viewing our boards as a guest so you have limited access to our community. Please take the time to register and you will gain a lot of great new features including; the ability to participate in discussions, network with our members, see fewer ads, upload photographs, create a retirement blog, send private messages and so much, much more!

Old 02-11-2013, 08:14 PM   #22
Thinks s/he gets paid by the post
growing_older's Avatar
 
Join Date: Jun 2007
Posts: 2,608
So, in case anyone is interested in the followup to the story, here's what happened. I did some more careful calculating and found that the latest run-up of the last few weeks has pushed my target 70/30 Equity/Fixed allocation into actually being 80/20. Maybe that was why my vague sense that something was too risky for my taste was tingling so much. I rebalanced back to my target 70/30 and I feel much better. Thanks for all the timely advice.
__________________

__________________
growing_older is offline   Reply With Quote
Old 02-11-2013, 10:29 PM   #23
Full time employment: Posting here.
 
Join Date: Oct 2012
Location: Reno
Posts: 556
Quote:
Originally Posted by Lsbcal View Post
What would stop me from reducing my AA here are the alternatives. Cash gives an assured loss to inflation and bonds are at relative highs.

Not a pretty picture.
Given bond yields, I see cash as a protection against a market correction (allows you both to use it to fund expenses and to pick up stocks at a discount). I'm almost in as much cash as bonds, but I see this as temporary, even if it lasts another 2-4 yields since we are at negative yields/zero bound.
In normal times, most of my cash would be in bonds, BTW.
__________________
RobLJ is offline   Reply With Quote
Old 02-12-2013, 07:51 AM   #24
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
pb4uski's Avatar
 
Join Date: Nov 2010
Location: Vermont & Sarasota, FL
Posts: 16,432
Before you do anything, watch the interview with Bill Miller on Wealthtrack from last week. I think he makes a pretty convincing case that equities will generate better returns than fixed income in the near term. If I were to change my AA from its current 56/38/6, I would probably be increasing equities rather than decreasing equities.

While I am in bonds right now, they scare me so I am in intermediate term bonds. probably should be shorter though.
__________________
If something cannot endure laughter.... it cannot endure.
Patience is the art of concealing your impatience.
Slow and steady wins the race.
pb4uski is online now   Reply With Quote
Old 02-12-2013, 08:45 AM   #25
Recycles dryer sheets
 
Join Date: May 2012
Location: Worthington
Posts: 158
Quote:
Originally Posted by growing_older View Post
Yes, just to be clear, I am NOT suggesting I pull completely out of equities or try to time the market with a strategic sell out now and buy in later. I am just suggesting I am contemplating a shift to a less aggressive AA, but acknowledging at least in part this may be because equity markets are near all time highs. I am concerned about how do I tease out is this really because I think it's time to make an AA shift, or is it at least in part because these valuations are making me nervous. Or maybe those are the same thing.
I definitely would not consider you a market timer based on this. Pretty prudent in most cases to make your AA more conservative as you near retirement.
__________________
LeavingOhio is offline   Reply With Quote
Old 02-12-2013, 10:37 AM   #26
Full time employment: Posting here.
 
Join Date: Apr 2006
Posts: 944
I recently went to a more conservative AA of 50/50 and feel good about it. Of course you will miss some potential upside $ if the market keeps climbing (the wall of worry). But if it tanks you will be in a better place and have dry powder to throw in.
__________________
Freed at 49. You only live once - live it
Donzo is offline   Reply With Quote
Old 02-12-2013, 02:30 PM   #27
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
clifp's Avatar
 
Join Date: Oct 2006
Posts: 7,450
Quote:
Originally Posted by growing_older View Post
So, in case anyone is interested in the followup to the story, here's what happened. I did some more careful calculating and found that the latest run-up of the last few weeks has pushed my target 70/30 Equity/Fixed allocation into actually being 80/20. Maybe that was why my vague sense that something was too risky for my taste was tingling so much. I rebalanced back to my target 70/30 and I feel much better. Thanks for all the timely advice.

Yes that is not market timing it is rebalancing, and perfectly acceptable. I believe the official rules for the "I am not dirty market timer club". Are you are allowed to rebalance up to quarterly (although there is no benefit doing more than once a year). And change your asset allocation once a year.

Of course I have never been a member of the club, so the rules probably have changed
__________________

__________________
clifp is offline   Reply With Quote
Reply


Currently Active Users Viewing This Thread: 1 (0 members and 1 guests)
 
Thread Tools Search this Thread
Search this Thread:

Advanced Search
Display Modes

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off
Trackbacks are Off
Pingbacks are Off
Refbacks are Off


 

 
All times are GMT -6. The time now is 05:56 AM.
 
Powered by vBulletin® Version 3.8.8 Beta 1
Copyright ©2000 - 2017, vBulletin Solutions, Inc.