Not loving the up and up of the markets

Lsbcal said:
Right. Catching those little blips down (red arrows below) is not easy and distinguishing them from the recessionary declines is harder.

Here is a long term semilog chart of VFINX (SP500 with dividends):

VFINX_blips_down.jpg
Click to expand...

Yeah - I guess ultimately that's why you have to use some averaging method if you can't stand to put it all in at once.

I remember I had some funds to invest in early 2006. I didn't want to invest right away, so I finally gave up and put them in in 2007. And then I promptly got my hand slapped - ouch!!!

At least I got lucky and was averaging in the bulk of my retirement funds over 2000-2002. I retired in 1999 and most of my funds were from divesting company stock 1998-2000.

So - I've been through some tough averaging in scenarios which hit huge bear markets, and for me the only thing that will probably work is a multi-year scenario.
 
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Hmm, is the market finally starting to turn cold? I'm still not ready to buy yet, I'm looking for the Oct 2016 S&P numbers to come around before I think about buying.

I did pay off a small car loan to improve my cash-flow.
 
dvalley said:
Hmm, is the market finally starting to turn cold? I'm still not ready to buy yet, I'm looking for the Oct 2016 S&P numbers to come around before I think about buying.

I did pay off a small car loan to improve my cash-flow.
Click to expand...

I dunno. Seems like a plunging market was the agreed-upon financial news story of the day in various news media like Yahoo and Reuters. And yet, the Dow was only down 46 points, about a fifth of a percent.

Might be a bit premature to run for the hills, IMO.
 
dvalley said:
Hmm, is the market finally starting to turn cold? I'm still not ready to buy yet, I'm looking for the Oct 2016 S&P numbers to come around before I think about buying.

I did pay off a small car loan to improve my cash-flow.
Click to expand...

In five years, today's prices will look cheap. In ten years, today's pricing will look like a once in a life time chance to purchase.
 
I have 10% cash on the side, will put in if S&P drops to 2280 but I have a 50 year horizon, so that wouldn't make/break me anyway.

However, I have my parents money they need to move out of a very bad investment, that will be DCA over the next year. I can't predict ups/downs and won't take the risk with their life savings but they also don't have the luxery to "wait" for a better time, so best to average it in and at least get them into them back into the market, can't do worse than what their advisor had them in... they lost 2% last year.... ummm rest of the world gained 15-20% they managed to lose money... I'm positive i can beat that.
 
karen1972 said:
I have 10% cash on the side, will put in if S&P drops to 2280 but I have a 50 year horizon, so that wouldn't make/break me anyway.

However, I have my parents money they need to move out of a very bad investment, that will be DCA over the next year. I can't predict ups/downs and won't take the risk with their life savings but they also don't have the luxery to "wait" for a better time, so best to average it in and at least get them into them back into the market, can't do worse than what their advisor had them in... they lost 2% last year.... ummm rest of the world gained 15-20% they managed to lose money... I'm positive i can beat that.
Click to expand...

Sounds like the advisor got a pretty good commission from the bad investment :facepalm:. At least seems like your parents were smart enough to have you help to stop the bleeding.
 
COcheesehead said:
In five years, today's prices will look cheap. In ten years, today's pricing will look like a once in a life time chance to purchase.
Click to expand...



I worry when people get too euphoric over the market. That's a sure signal to add to my cash position.
 
COcheesehead said:
In five years, today's prices will look cheap. In ten years, today's pricing will look like a once in a life time chance to purchase.
Click to expand...

True because over long periods of time the market will go up. However, there's no rhyme or financial reason for the market to be pegged as high as it is. What has really changed since late last year? It's just speculation at this point. All predictions (i know i know) say we're due for a market crash soon. I watched the Bogle interview on CNN a few days ago, he too basically said he's concerned because emotions are heavily driving the market. So I'd rather not plow my money in at the market's current peak even if it will eventually go back up and surpass this point in 5-10 yrs.
 
Dash man said:
I worry when people get too euphoric over the market. That's a sure signal to add to my cash position.
Click to expand...

Let me know right before you sell...so I can sell mine first :D You have been right before in terms of market sentiment/euphoria
 
Hmm, is the market finally starting to turn cold? I'm still not ready to buy yet, I'm looking for the Oct 2016 S&P numbers to come around before I think about buying.

I did pay off a small car loan to improve my cash-flow.
Click to expand...

If someone held an opinion like that after March 2009 they would still be waiting.
 
there should be a large influx of profit/spend and investments as folks get refunds...and govt gets their $. I sort of judge my investment pace by the frequency of trains that roll by my home. one just passed as I type this today, I've been seeing a LOT of trains...and long heavy ones and in the past month, definitely most ever in past 3yrs I've lived here. BNSF, Canadian and UNP all run engines on this line.

I live between border states and see at least positive in rail usage. Summer came early so you'd think that would be kind to the markets...no risk of flooding that I can see this year so ag should be well for farmers. What's the negative news? Govt doesnt get anything done...that's typical. :angel:
 
DrRoy said:
If someone held an opinion like that after March 2009 they would still be waiting.
Click to expand...

+1. Some still are, actually.

Still, I'm partially hedging my bet. Solid cash position and proud of it. About half is in public equities, and quite a bit in CDs and such.

Heads I win, tails I don't lose much.
 
dvalley said:
True because over long periods of time the market will go up. However, there's no rhyme or financial reason for the market to be pegged as high as it is. What has really changed since late last year? It's just speculation at this point. All predictions (i know i know) say we're due for a market crash soon. I watched the Bogle interview on CNN a few days ago, he too basically said he's concerned because emotions are heavily driving the market. So I'd rather not plow my money in at the market's current peak even if it will eventually go back up and surpass this point in 5-10 yrs.
Click to expand...
Bogle agreeing with Shiller? Again?

Totoro said:
+1. Some still are, actually.

Still, I'm partially hedging my bet. Solid cash position and proud of it. About half is in public equities, and quite a bit in CDs and such.

Heads I win, tails I don't lose much.
Click to expand...
+1

My cash AA is getting low. Time to get some more by selling some stocks, or writing more covered calls.
 
dvalley said:
True because over long periods of time the market will go up. However, there's no rhyme or financial reason for the market to be pegged as high as it is. What has really changed since late last year? It's just speculation at this point. All predictions (i know i know) say we're due for a market crash soon. I watched the Bogle interview on CNN a few days ago, he too basically said he's concerned because emotions are heavily driving the market. So I'd rather not plow my money in at the market's current peak even if it will eventually go back up and surpass this point in 5-10 yrs.
Click to expand...

I hope you realize emotions are driving you too, but in your case it's fear. Find the AA that will get you to your goal and stick with it. Don't "plow" money in, disburse to your AA and forget it.
If you follow Bogle, thats what he would say to do. Time in the market, not timing the market.
 
COcheesehead said:
Find the AA that will get you to your goal and stick with it. Don't "plow" money in, disburse to your AA and forget it.
Click to expand...

+1.

Establishing an AA based on risk tolerance and rebalancing when it gets way out of whack is the prudent thing to do. If one can sleep at night when the portfolio loses 25% of its value then having a 50% allocation to stocks is within the risk tolerance (Stocks lost 57% back in 2007-2008).

Since I can't predict the short term market fluctuation I don't attempt to time it.
 
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Some folks forget in most, if not all cases, an AA has a bond component. When bonds dropped, my AA was flashing buy more bonds, though the news was saying more rate hikes are coming. I let math be my guide and I bought more bonds, trickling in every two weeks. Guess what's up YTD in the portfolio: bonds.
 
COcheesehead said:
Some folks forget in most, if not all cases, an AA has a bond component. When bonds dropped, my AA was flashing buy more bonds, though the news was saying more rate hikes are coming. I let math be my guide and I bought more bonds, trickling in every two weeks. Guess what's up YTD in the portfolio: bonds.
Click to expand...

What?!?!?! You actually take your AA seriously?

COcheesehead, you are a dangerous radical! :D
 
Chuckanut said:
What?!?!?! You actually take your AA seriously?

COcheesehead, you are a dangerous radical! :D
Click to expand...

If you read some of the threads on here, I thought there were more people on here like me, but evidence to the contrary pops up from time to time. :LOL:
 
Alright good folks, I think here's what I'll do with the $280k I have. I'll setup a DCA schedule for $15k every month. All going into VTSAX, all in my rollover IRA which I won't (be able to) touch for about 17yrs. Sound like a plan?
 
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