Feeling dumb and poor as the market goes up?!

[JohnEyles]

Listen to the other posters, Your emotions will drive you nuts!

And if they don't convince you, go read:

http://news.morningstar.com/article/article.asp?id=178504&pgid=wwhome1a

(but do it soon, it's a Morningstar article and probably expires soon).

 

[FinanceDude]

I one had a propsect tell me he needed an advisor to help him manage his options, because he was feeling "drunk with power"...........I declined, and last I heard he lost $800,000 in the tech wreck.........

 

[tryan]

kcowan, FD,

I didn't make any claim about the future .... my crystal ball is pretty foggy . The spread sheet I keep goes back 11 years ... started with a NW of 161k in Jan97; have 2.04m today. Average annual return of ~20%.

At the risk of repeating myself ... peaked out at 23 units sold off everything but the 6 I still carry.

The last decade has been very kind to RE; who knows what we face going forward. But I'ld say the same thing about stocks (are we in a cyclical bull in a secular bear?).

 

[FinanceDude]

kcowan, FD,

I didn't make any claim about the future .... my crystal ball is pretty foggy . The spread sheet I keep goes back 11 years ... started with a NW of 161k in Jan97; have 2.04m today. Average annual return of ~20%.

At the risk of repeating myself ... peaked out at 23 units sold off everything but the 6 I still carry.

The last decade has been very kind to RE; who knows what we face going forward. But I'ld say the same thing about stocks (are we in a cyclical bull in a secular bear?).

i think you should write a book about it, and put Rich Dad out of business........

 

[dmpi]

kcowan, FD,

I didn't make any claim about the future .... my crystal ball is pretty foggy . The spread sheet I keep goes back 11 years ... started with a NW of 161k in Jan97; have 2.04m today. Average annual return of ~20%.

Now that... is pretty damn impressive.

 

[wabmester]

The last decade has been very kind to RE; who knows what we face going forward. But I'd say the same thing about stocks (are we in a cyclical bull in a secular bear?).

Exactly! Why do people dis real estate investors and then pimp stock investments as superior?

Stocks are less stable and less predictable than real estate, yet the historical returns are very similar.

And when the economy goes to hell, with real estate you're left holding a real asset. Everybody needs to live someplace. What will you do with your stock certs to keep you warm at night?

 

[haha]

As the stock market keeps going up I'm feeling I made a mistake and should have had the 24% invested in the stock market.

Any others feeling the same way?

Today's punters keep drawing to an inside straight. They keep filling. This doesn't change my conviction that this is stupid behavior which will in the fullness of time be duly punished.

It sure is taking a hell of a lot longer than I anticipated though!


Ha

 

[Cb]

Today's punters keep drawing to an inside straight. They keep filling.

Ha

Translation?

Cb

 

[bosco]

Translation?

Cb

it's the mother of all mixed metaphors

 

[Nords]

Translation?

"The market can remain irrational for longer than you can remain solvent."

 

[tryan]

Now that... is pretty damn impressive.

Thanx .... but I believe anybody who FIRED before 45 would have a similar story/returns.

 

[Cut-Throat]

Today's punters keep drawing to an inside straight. They keep filling. This doesn't change my conviction that this is stupid behavior which will in the fullness of time be duly punished.

It sure is taking a hell of a lot longer than I anticipated though!


Ha

When it finally happens, you and Ho*us can celebrate and can buy all the cheap stocks that you want!

 

[haha]

it's the mother of all mixed metaphors

I give you that! Although punter may have originally been a racing term, it has perhaps been generalized to any bettor?

Nevertheless, I should try to do better. Especially when there are people on this board capable of pulling well chosen quotes from William Cowper.

Ha

 

[yakers]

HA is about as far as you can get from that s&^thead, Ho&us. I pay atttention to HA's financial postings. It is not obvious to me that bad things will happen financially, more like mixed financial signals, but it makes no sense to not allow for a serious market decline. I would not suggest going all cash but I have 8% to 9% in cash these days and I hope to snag bargains and avoid drawing on deleted funds if the market should decline.

 

[FinanceDude]

Exactly! Why do people dis real estate investors and then pimp stock investments as superior?

Stocks are less stable and less predictable than real estate, yet the historical returns are very similar.

And when the economy goes to hell, with real estate you're left holding a real asset. Everybody needs to live someplace. What will you do with your stock certs to keep you warm at night?

The paper burns pretty hot..........particularly Enron........

 

[donheff]

I should try to do better. Especially when there are people on this board capable of pulling well chosen quotes from William Cowper.

Google.

 

[Mr._johngalt]

Exactly! Why do people dis real estate investors and then pimp stock investments as superior?

Stocks are less stable and less predictable than real estate, yet the historical returns are very similar.

And when the economy goes to hell, with real estate you're left holding a real asset. Everybody needs to live someplace. What will you do with your stock certs to keep you warm at night?

This is why I still own more real estate than anything else.

JG

 

[d]

What will you do with your stock certs to keep you warm at night?

do you have a woodstove or fireplace?

 

[Cut-Throat]

This is why I still own more real estate than anything else.

JG

Well, I'm sure Wab will be happy to hear this!

 

[HFWR]

Considering the tenants I've been around around which I've been, I've never has much of an urge to be a landlord...

I'm about 20% cash at present, partly because I've been juggling my portfolio holdings/allocation/simplification, and partly because, gulp, of dirty market timing...

I upped the international, moved back into emerging markets, added some TIP, sold GLD and VGPMX, bought PCRIX, sold RWR, and got rid of microcaps.

Most of the shuffling came from moving to Vanguard for the lower ER. Swapped EFA for VGK and VPL. Also bought VWO.

10% - SP500 - 0.04%
10% - Russ2000 - 0.04%
10% - VGK - 0.18%
10% - VPL - 0.18%
5% - VWO - 0.30%
20% - TIP - 0.20%
5% - Intermediate bond fund - 0.03%
5% - PCRIX - 0.74%
5% - IGR - 1.48% (from etfconnect; IGR website says 0.96%...)
20% - MM

 

[haha]

"The market can remain irrational for longer than you can remain solvent."

Although this is true about certain exposed speculative positions, there are choices other than 100% in, or 100% contra.

Can't speak for others, but I am very aware of many of the tiger traps, and if necessary I could last indefinitely with my current allocation. However the one constant is change (though that seems to have been repealed recently), so eventually I will be presented with the possibility of an attractive and more aggressive allocation.

If this isn't true, nothing I have learned in my 65 years on this planet makes sense anymore.


Ha

 

[JohnEyles]

... sold GLD and VGPMX ...

What's your thinking ? I thought the idea of commodities was very low
correlation with stocks, thereby reducing volatility.

 

[FIREAway]

I subscribe to a few of the Motley Fool newsletters, they were enormously helpful for providing insights into which stocks/funds to buy. And they tend to re-iterate sound investment advice. Note: some of their newsletters have very volatile recommendations, only for those that like roller coasters.

Four months is too short a time frame to feel dumb. In these same four months, the market may have tanked and your foreign currency investments may have soared, and you'd be equally incorrect in feeling brilliant. That being said, you should consider adjusting your asset allocation. And yes, foreign currency investing sure sounds risky to me!

Good luck.

Michael

 

[lazyday]

The last decade has been very kind to RE; who knows what we face going forward. But I'd say the same thing about stocks (are we in a cyclical bull in a secular bear?).

Exactly! Why do people dis real estate investors and then pimp stock investments as superior?

Stocks are less stable and less predictable than real estate, yet the historical returns are very similar.

And when the economy goes to hell, with real estate you're left holding a real asset. Everybody needs to live someplace. What will you do with your stock certs to keep you warm at night?

While I think these are a good points, I suspect that RE is more standard deviations above normal price than stocks (tho I don't have data), and more overvalued compared to intrinsic value (tho I don't have an argument to back that up ).

I think that graphs from GMO have shown residential RE as much more above trend than stock prices are. Not sure about commercial. If you have faith in their use of valuations to determine their 7 year forecasts, note that REITs have a worse predicted return than S&P500 on page 2. (GMO is a biased source, so I take their suggestions with a big grain of salt.)


Also, even with stocks, you still have ownership of something real, in the non-financial sense of "real." If you buy dividend paying megacaps (or BRLIX, though not great dividends) then most should survive a terrible economy, and maybe even continue to pay dividends. Though not at the same yield from today's prices as REITs, of course. And I wouldn't make the same argument for smallcap value.

GMO and others feel that "high quality" U.S. stocks aren't so badly priced. And, since they have low leverage, consistant profitability, and high ROA, they should also survive a bad economy.

 

[HFWR]

What's your thinking ? I thought the idea of commodities was very low
correlation with stocks, thereby reducing volatility.

Due to a change in my 401k self-directed, I was able to get PCRIX. Additionally, VGPMX was closed to new investors (can you say 'asset bloat'?), and, over at RADDR's board, his timing model gave a sell signal. Seemed like a good time drop GLD and VGPMX...

As an aside, I made a killing, percentage wise. 8)