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Old 08-10-2018, 11:09 AM   #41
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I wish that crash would hurry-up and happen, because I've had $100k in cash I've been wanting to invest since 2013! At least I've been sleeping well the last 5 years.
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Old 08-10-2018, 12:03 PM   #42
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Yes. I look at my portfolio as if it were rental property.

A hot housing market will raise the "sell" price if I ever were to sell, and then something...maybe some road construction might lower the sale price for a while.

But all along the way, the property is still there paying rent (dividends or interest), appreciating over time and doesn't loose any real value until I do, indeed, sell it.
Hey there, I am the guy who has been "flipping" houses in your neighborhood!
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Old 08-10-2018, 12:13 PM   #43
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Hey there, I am the guy who has been "flipping" houses in your neighborhood!
Not in my neighborhood. No one has sold a house around here since JFK was in office. The next generation of the family just moves in when the previous one dies.
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Old 08-10-2018, 12:17 PM   #44
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My fear is not a big crash. Rather I think it is much more likely that the next 5-10 years will produce lower real growth in my assets. Combine that with interest rates that are still near historical lows ( My father would never believe one could get a mortgage at less than 5% or five year CD's at a measly 3% were such a good deal.) that I feel obliged to take some precautions.

With $1,000,000,000,000 Federal deficits on the horizon, I also wonder how we can handle that even with solid economic growth.

So, I am watchful and cautions.
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Old 08-10-2018, 12:20 PM   #45
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My fear is not a big crash. Rather I think it is much more likely that the next 5-10 years will produce lower real growth in my assets. Combine that with interest rates that are still near historical lows ( My father would never believe one could get a mortgage at less than 5% or five year CD's at a measly 3% were such a good deal.) that I feel obliged to take some precautions.
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True and good to be aware, but what precautions can be taken other than taking on more risk?
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I'm getting spooked about the markets
Old 08-10-2018, 12:24 PM   #46
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I'm getting spooked about the markets

To the OP (jjflyman): Don't be spooked - - - be READY. Have some cash on the side, and know exactly what you will do in each of various possible scenarios.

A market crash can ruin you, or it can give you the most amazing boost to your nest egg, ever. Buying low really does wonders! Now is the time to be putting as much money aside as you can manage, until you feel you are ready.

I already feel like I am ready, and have been for years. So, I am investing as always and thrilled to see my nest egg returning to its all time high value from last January.
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Old 08-10-2018, 12:29 PM   #47
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True and good to be aware, but what precautions can be taken other than taking on more risk?
Good question.

In my case the precaution is to make sure I dance a few dances with the one that brought me here - LBYM. IOW, don't make any commitments that require me to have the more traditional stock and bond returns.

Ther are no magic bullets, I can find.
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Old 08-10-2018, 01:12 PM   #48
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I've had a very uneasy feeling for the past few weeks.
That's bad.

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I have nothing to back up my feeling, I know the economy is going good, but I must have a little PTSD in me from the last few market drops
That's bad.

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Anyway, I think I am going to pull out over the next few weeks/months and be done with it, I don't want to go through another correction.
If you were planning to time the market, I'd suggest that you write down the plan for getting back in before getting out.

But since you seem to be checking out for good, I'll just wish you Good Luck and hope you meet whatever goals you have in mind. Hopefully this move will let you feel better.
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Old 08-10-2018, 01:14 PM   #49
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I wish that crash would hurry-up and happen, because I've had $100k in cash I've been wanting to invest since 2013! At least I've been sleeping well the last 5 years.
Hmm. Have you calculated the rate of return you got on the rest of your portfolio for the past 5 years? And thus you know the cost of sleeping well?
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Old 08-10-2018, 01:14 PM   #50
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I have enjoyed this thread very much.
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Old 08-10-2018, 01:16 PM   #51
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I was much heavier invested then, and like everyone else, I lost a ton.
Not everyone else.

Some of us had an Asset Allocation strategy that we were comfortable with. Some of us didn't lose a ton. Some of us didn't lost any sleep.
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Old 08-10-2018, 01:47 PM   #52
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I'm getting spooked about the markets
markets go up, markets go down. Pick your allocation and sleep easy. I do
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Old 08-10-2018, 02:50 PM   #53
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Hmm. Have you calculated the rate of return you got on the rest of your portfolio for the past 5 years? And thus you know the cost of sleeping well?
Believe me, I *know* it was stupid to have cash the last 5 years. I guess the sarcasm in my last post was not that obvious.

Thankfully, it's just 5% of my portfolio. And at least I get some interest.
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Old 08-10-2018, 03:23 PM   #54
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Did you mean to use the Schiller P/E in the first paragraph and the P/E in the second? Of course, they are different things. S&P 500 P/E right now is 23.74, about the same as one year ago. And I’m seeing a yield of 1.82% on the S&P 500 presently.

No, Shiller P/E both times. Just like with individual companies I don't trust the single year P/E as much, too much noise in the signal. Also, I'm referring to the earnings yield, not the dividend yield. The former is basically inverted P/E.

Earnings come out either as dividends, or are invested in (hopefully) future growth or buybacks, so they are a useful proxy when comparing to bonds.
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Old 08-10-2018, 03:50 PM   #55
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Not in my neighborhood. No one has sold a house around here since JFK was in office. The next generation of the family just moves in when the previous one dies.
Sounds nice, reminds me of this place:
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Old 08-10-2018, 03:53 PM   #56
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If you're getting nervous, review page 13 and page 17, please.
https://advisor.mp.morningstar.com/r...a-0bc008df9f25
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Old 08-10-2018, 04:34 PM   #57
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Yet another one of these threads. A bullish indicator.

Now, if it were another "I'm making a killing in the market and want to borrow on credit cards to invest" thread, it would be a bearish indicator.

ALL bull markets end badly. Repeat that to yourself: ALL bull markets end badly.

So, the question isn't whether the bull market will come to an end. It will. The question is when and at WHAT LEVEL relative to RIGHT NOW.

If your equity allocation is large enough that losing 10%, 20%, 30%, 50%, maybe even more of it would make you distraught or ruin your life, then sell enough to eliminate that consideration. But don't fool yourself - you are giving up (if you live long enough) additional buying power and more importantly protection against a rising cost of living.
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Old 08-10-2018, 05:01 PM   #58
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Hmm. Have you calculated the rate of return you got on the rest of your portfolio for the past 5 years? And thus you know the cost of sleeping well?

after about a decade of being a workaholic ( in highly active employment ) i know the cost of NOT sleeping well ,

but when i started my plan in 2010 i DID need to grow the portfolio value (
by more than 3 times in 10 years ) and in mid 2016 .
had i still have had that cash sitting in the bank i might have had some even larger health care costs for at least six months and that cash pile might have been halved of even worse )

so one size doesn't fit all in my opinion ( another example of me having a good result using all the wrong logic ).
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Old 08-10-2018, 05:21 PM   #59
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Believe me, I *know* it was stupid to have cash the last 5 years. I guess the sarcasm in my last post was not that obvious.

Thankfully, it's just 5% of my portfolio. And at least I get some interest.
stupid ?? i disagree maybe you needed the sleep more than i needed accelerated growth ( without resorting to penny dreadfuls all the time )

investing comfort must be about risk tolerance and your personal goals

to my mind my asset base was too small and i had just 10 years to make it all financially sound ( if possible )

had i actually been retired in 2010 maybe my plans and needs might have been very different ( for better or worse )
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Old 08-10-2018, 05:56 PM   #60
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I wish that crash would hurry-up and happen, because I've had $100k in cash I've been wanting to invest since 2013! At least I've been sleeping well the last 5 years.
Glad you're sleeping well! I sure wish I was. In the past 5 years, I've averaged a 11.5% rate of return on my investments.

Your purchasing power, according to the CPI, has dropped by 7% over the same period. With inflation, being 'safe', means losing money.
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