Felder Report references Buffett Strategy, suggests investors are overextended

[unclemick]

Soo - the bouncing ball says I have used 22 out of my 30 yr planned retirement and full auto balanced index is sliding toward 40/60 from 60/40. I hope to live longer and I believe the retirement portfolio can survive a minor 50% drop in stocks from here to croak time.

I think Mr B as in Bogle thinks stocks are going to return below historical trend using his method of estimation.

heh heh heh - Football and a few good stocks for mad money. Full auto for the rest. And some good defense wins Superbowls.

 

[hesperus]

I have no doubt that stocks are over-extended and due for a correction, or consolidation. I also know if I get out, I will likely think the same as they go higher.

If stocks go lower after I am out, I will think they will continue to go lower as they make a turn. And I will continue to wait for the 'great time to buy'. Then, I will gradually move back in, and most of my cash will miss the next run-up.

After all that, I will not make as much than if I stayed 100% in, and I would miss any dividends. I would constantly be looking at the charts, opinions, etc. and stay awake at night.

If I am my own financial adviser, I need to follow the advisers advice. They would say, "Stay the course, 130+ years of history can't be all wrong". Asset allocations and dividend cash flow will take care of any volatility and cash needs, along with other diversified income streams.

In the meantime, I keep buying.

+1

I have a 'play money account that I hold outside my primary investment accounts, with a few grand in there. That play account is where I try my 'market timing' experiments with S&P ETF's (usually leveraged ETF's like SPXL and SPXU). I won some and lost some, but over time I'm pretty much where I would be if I were to just stay in. What I've learned from that is I will never try to time the market with my primary investment accounts. I may keep more cash during times of high valuations, ready to put to use in pullbacks (yes this is timing too, but much less risky). But I'm not going to move large sums in and out of the market. The cash flow is such that it's easier and more sensible to stay the course.

But right now in my play account, I'm all in with SPXU!