For the first time ever I sold all my stocks

[CSdot]

Except in times of uncertainty and upheaval. Like now eh?

I'm wishing I bought 40 ounces back when it was $1350.

With gold at $1922 now, that's only a gain of $22,880 on a purchase of $54K. You can't retire on that gain. Oops, forgot that you are already retired.

Oh well, it's still better than holding cash, and I have a heck of a lot more cash than $54K.

NW-Bound:

I think the point is Gold is for times of uncertainty, which some might point to events of the current day. Any least for me, Gold is not an investment I would look at as a retirement vehicle/investment that I would plan would grow to sustain me during my old age, but some amount (that 40 oz sounds good) is nice to have (like insurance) for if and when times get sketchy.

 

[NW-Bound]

I was making a wouldda shouldda joke as a trader, seeing it mentioned that gold has been doing well recently.

I have not been following gold recently. The last time I traded GLD was quite a few years ago. It fell off my radar, as I was busy watching something else.

If I worry about hard times, I think I would want more than $54K to feel safe. Maybe even $54K in lead (would want some black powder to go with it too)

 

[CSdot]

I was making a wouldda shouldda joke as a trader, seeing it mentioned that gold has been doing well recently.

I have not been following gold recently. The last time I traded GLD was quite a few years ago. It fell off my radar, as I was busy watching something else.

If I worry about hard times, I think I would want more than $54K to feel safe. Maybe even $54K in lead (would want some black powder to go with it too)

Good point.

 

[RetiredAtThirty-eight]

Except in times of uncertainty and upheaval. Like now eh?

I'm wishing I bought 40 ounces back when it was $1350.

Hindsight is 20/20 but I certainly wouldn't recommend buying gold now as an investment OR as a hedge.

 

[smihaila]

Overall I agree with you except that sometimes "intuition" has been the exact right thing to follow. My intuition in 2007-2008 was that NINJA loans, 125% equity, and securitizing such loans was a recipe for disaster (especially as ARM's were about to reset), and so got out of the market completely about a month before the big crash. I then re-entered after a short while, and that intuition allowed me (because of this bull market) to retire years before I had planned.

Once or twice in the decade since I've also successfully mostly sold right before big drops I sensed were coming. This is not to say I try to time the market, just that I have a comfort level about movement, and so far it has served me well. My preference, though, is to ride things out and have often done so beyond my comfort level. But as I wrote initially, something feels different this time.

Well, it looks like ... you do .

 

[smihaila]

I absolutely agree. I adopted a capital preservation portfolio when I reallocate my 60/40 portfolio to 100% treasury bonds when the yield curve inverted in 2019.

I avoided the crash and now my VUSUX is +20% YTD in 2020. Most "inexperienced" investors do not even know what "capital preservation" is or have never used this legitimate investment objective.

You use this objective when the market risk increases above your risk tolerance. This happens when a bull market breaks the record of the longest bull market in history. The inexperienced investors believed that a bull market last forever and a bear market never happens. The experienced investors know how to quit when they are ahead and they are also fearfull when everyone is greedy.

Do you have an oracle that tells you (1) When the bull and bear markets begin and end, and (2) When to get out and re-enter the market?

Or some connections with market insiders maybe? .

 

[smihaila]

Watching my portfolio evaporate in large chunks daily was quite unsettling. I used the opportunity to educate myself on the situation ...

That's indeed a good opportunity to understand one self better - their real risk tolerance.

... and pay close attention to what was happening in the market. Rare times indeed.

What is "rare" as situation, IMHO, is the need to "pay close attention to what was happening in the market". To me this looks like maybe you shouldn't be in the stock market at all, or you're aiming for a very short (i.e. less than 5 years)) investment "horizon"?

Now that the market has headed back up, I have bought and sold several positions as somewhat of a rebalance, but mainly looking for opportunities to profit, whether it be short term or longer term. Currently, I am down 5% also, but have made many changes to my portfolio. In the end, I think that I am in a better place than when all of this started, based on the belief that our economy will survive just fine and that the stock market will soar once again.

I think that I might be in the stock and cash hoarder group also.

No, just look yourself in the mirror, and correctly admit what you are doing: it's called market timing!

 

[RetiredAtThirty-eight]

No, just look yourself in the mirror, and correctly admit what you are doing: it's called market timing!

Yes, or more accurately, trying to time the market.


Fidelity did an internal audit one year to see if they could discern any patterns of their brokerage clients whose accounts had the best performance. They learned that accounts that had the best performance were owned by clients who had died or forgot they had an account at Fidelity.

Timing the market doesn't work.

 

[tdv2]

Timing the market doesn't work.

It's not difficult to understand why. We live in a world that is unimaginably complex and not regular enough to be deterministic in the short run. i.e. randomness prevails. Many try to sell out and dodge a bear or double down on a bull and the outcome is always what you would expect in the uncertain world--a lucky or an unlucky guess.

 

[stepford]

Most of the lessons I've learned during my investing career have taken the form of having my nose shoved into the fact that I don't know more than anybody else. So I've been primarily an index investor for the last 20 years and learned that pretty much any big move I could make was a mistake. This may not be true for all the smart folks with index-beating returns this year but it's true for me.

About the most I ever do is accelerate my rebalancing a bit in particularly volatile times. So I did that this year and rebalanced in July, selling about 2% of my assets. And yes, true to form, it was a mistake. But at least not a very costly one, costing me about 0.4% in annual return compared to a typical year end rebalance. Consider my nose shoved in it once again.

In a similar vein, I bought some gold 11-12 years ago around the time of the last crash - at the time also around 2% of my assets. It's done "OK" but has been beaten handily by stock indices over time. I guess it made me feel better in March of last year as it went up while everything else tanked, but I recognize that it's not a great investment. And yet I don't plan to sell it. With my track record that too would probably end up being a mistake.

 

[VanWinkle]

Most of the lessons I've learned during my investing career have taken the form of having my nose shoved into the fact that I don't know more than anybody else. So I've been primarily an index investor for the last 20 years and learned that pretty much any big move I could make was a mistake. This may not be true for all the smart folks with index-beating returns this year but it's true for me.

About the most I ever do is accelerate my rebalancing a bit in particularly volatile times. So I did that this year and rebalanced in July, selling about 2% of my assets. And yes, true to form, it was a mistake. But at least not a very costly one, costing me about 0.4% in annual return compared to a typical year end rebalance. Consider my nose shoved in it once again.

In a similar vein, I bought some gold 11-12 years ago around the time of the last crash - at the time also around 2% of my assets. It's done "OK" but has been beaten handily by stock indices over time. I guess it made me feel better in March of last year as it went up while everything else tanked, but I recognize that it's not a great investment. And yet I don't plan to sell it. With my track record that too would probably end up being a mistake.

Thank for describing my own investing history. I appreciate your honesty and find the same to be true with my own "mistakes" in the past.

VW

 

[NW-Bound]

Market in the long run goes up. Therefore, if I sell I will want to get back in at some point. I do not have to get back in at the absolute bottom. If I can get back at a lower price than I sold at, I consider my timing move a success.

The idea is that if I beat a buy-and-hold guy, I win. Even if I still lose money (in the short term), I lose less than he does.

 

[VanWinkle]

Market in the long run goes up. Therefore, if I sell I will want to get back in at some point. I do not have to get back in at the absolute bottom. If I can get back at a lower price than I sold at, I consider my timing move a success.

The idea is that if I beat a buy-and-hold guy, I win. Even if I lose money (in the short term), I lose less than he does.

If it always goes up, why risk getting out at all? Time in the market beats
timing the market for most people. You may be one of those people that
can time the market a few times and win, but long term the record is not
a winning record. If you can do it consistently, congrats to you. You are the exception, not the rule.

VW

 

[NW-Bound]

If it always goes up, why risk getting out at all? Time in the market beats
timing the market for most people. You may be one of those people that
can time the market a few times and win, but long term the record is not
a winning record. If you can do it consistently, congrats to you. You are the exception, not the rule.

VW

I am sure doing it consistently is hard.

As for my records, I do not jump in/out of the S&P because I am not an indexer. I buy-and-hold individual stocks, and am reasonably diversified. My stocks generally have a lower P/E than the S&P, let alone that of the FAANG stocks or EV-related stocks.

I generally do not sell/buy stocks, and try to enhance my return via selling out-of-the-money calls on stocks that are hot, and also selling out-of-the-money cash-covered puts on stocks that turn cold. And I only do this on stocks that I do not mind owning long-term.


PS. What I am doing is a form of market timing, but it can also be looked at as "forced rebalancing". The difference with plain rebalancing is that if the stocks fluctuate within a band that I choose, the options do not get exercised and I pocket the cash premium. Perhaps one can do this with the S&P, but individual stocks jump around more than the sum of them. The premium on individual stocks is therefore higher.

 

[RetiredAtThirty-eight]

About the most I ever do is accelerate my rebalancing a bit in particularly volatile times. So I did that this year and rebalanced in July, selling about 2% of my assets. And yes, true to form, it was a mistake. But at least not a very costly one, costing me about 0.4% in annual return compared to a typical year end rebalance. Consider my nose shoved in it once again.

Prevailing wisdom regarding periodic rebalancing is counter-productive. It recommends rebalancing too much and too often which causes people to sell their winners off too soon and buy more of their losing positions. I do a form of rebalancing to manage risk but it looks very different from what is commonly recommended. I'm more likely to dump the losers, especially if I don't see them bouncing back.

In a similar vein, I bought some gold 11-12 years ago around the time of the last crash - at the time also around 2% of my assets. It's done "OK" but has been beaten handily by stock indices over time. I guess it made me feel better in March of last year as it went up while everything else tanked, but I recognize that it's not a great investment. And yet I don't plan to sell it. With my track record that too would probably end up being a mistake.

Don't beat yourself up too much, that leads to an inability to effectively manage your investments. Now would be a great time to get out of gold.

While timing the market has repeatedly proved to be a less than zero-sum game, picking good companies for the long-term is not that difficult once you know how to do it. I have out-performed the major indices by a HUGE amount by avoiding all the "dogs" they contain and concentrating on the most promising companies. This is not traditional "value" investing in which I look for "cheap" shares, it's "value" investing in which I buy companies that are likely to grow revenues and earnings at a superior rate to the rest of the market without much focus on whether they are currently valued high or low. The valuation can't be so high that there is simply little chance it can grow into itself but it can be so high (based on projected one-year earnings) that the typical stock analyst says it's over-valued. Those are often the best ones to own for the long-term.

Good stock picking can work wonders, timing the market doesn't work.

If I could impress one thing upon a new or inexperienced investor it would be that time is the great equalizer. Pick companies with superior management and business prospects without too much focus on "value" and let time work it's magic. Do not buy or sell based on valuation metrics! If the company is a good company, hold, hold, hold.

 

[Jerry1]

Most of the lessons I've learned during my investing career have taken the form of having my nose shoved into the fact that I don't know more than anybody else. So I've been primarily an index investor for the last 20 years and learned that pretty much any big move I could make was a mistake. This may not be true for all the smart folks with index-beating returns this year but it's true for me.

About the most I ever do is accelerate my rebalancing a bit in particularly volatile times. So I did that this year and rebalanced in July, selling about 2% of my assets. And yes, true to form, it was a mistake. But at least not a very costly one, costing me about 0.4% in annual return compared to a typical year end rebalance. Consider my nose shoved in it once again.

In a similar vein, I bought some gold 11-12 years ago around the time of the last crash - at the time also around 2% of my assets. It's done "OK" but has been beaten handily by stock indices over time. I guess it made me feel better in March of last year as it went up while everything else tanked, but I recognize that it's not a great investment. And yet I don't plan to sell it. With my track record that too would probably end up being a mistake.

Thank for describing my own investing history. I appreciate your honesty and find the same to be true with my own "mistakes" in the past.

VW

This is exactly what happens to me. Ya’ll can thank me for the 2020 recovery. I sold most of my equities the last day of March. Market pretty much did nothing but go up since. I just wish I could get a percentage of everyone else’s benefit from my stupid actions. Oh well. I’ve been DCA’ing back in so hopefully I’ve learned my lesson. It’s a lot different watching the market go down when you are no longer working and getting up in years.

 

[Beachcomber]

Did you see what happened to BNGO today? I mentioned it in post 732. It was $3.08 this morning and is now at $6.43. I normally stay away from individual stock picks, but this is not a bad one to hold long term.

I still like the ARKG ETF. They may add BNGO soon.

 

[RetiredAtThirty-eight]

Did you see what happened to BNGO today? I mentioned it in post 732. It was $3.08 this morning and is now at $6.43. I normally stay away from individual stock picks, but this is not a bad one to hold long term.

I still like the ARKG ETF. They may add BNGO soon.

ARK has never pre-announced a position they intend to take. The fact that ARKG does not currently hold BNGO leads me to believe it didn't make the cut when they last analyzed it and I haven't seen news that would lead me think they had changed their mind.

Genomics is a volatile field. Some companies in the sector will soar, others will go bankrupt or constantly need new funding. One advantage of buying a fund like ARKG is that it will be much less volatile and more certain to have positive returns than any single company in the sector. Also, genomics experts have already vetted the holdings. They only buy those they feel are most likely to succeed.

I don't know anything about BNGO but the fact that ARKG hasn't bought them yet doesn't instill confidence. Of course, that's not a lot to go on and I haven't vetted them myself.

 

[NW-Bound]

I did not know about the company with the stock symbol BNGO, so I had to look it up.

It did cause me to think of the nursery rhythm "Bingo".

 

[RetiredAtThirty-eight]

I did not know about the company with the stock symbol BNGO, so I had to look it up.

It did cause me to think of the nursery rhythm "Bingo".

I know. That's what made me think it might be one of those "pump-n-dump" stocks and that would explain why ARKG didn't have any!

 

[RobbieB]

I'mma gonna sell me some more equities soon. But not all. Just a little bit. About 2% ought to do it -

 

[VanWinkle]

Did you see what happened to BNGO today? I mentioned it in post 732. It was $3.08 this morning and is now at $6.43. I normally stay away from individual stock picks, but this is not a bad one to hold long term.

I still like the ARKG ETF. They may add BNGO soon.

"The performance data shown represent past performance, which is not a guarantee of future results."

I always worry about the hot stocks or ETF's that suddenly everyone is talking about. I wish I was in this last January, instead of hearing great things today.

 

[RetireeRobert]

I was already in largely cash positions going into spring 2020 when Covid sent the market reeling. I took advantage of the dip to position into dividend paying stocks.

But now in winter 2020-2021, I am feeling the market is out of whack, and have begun lightening up on my stock positions. On any surges in some of my lower-yielding positions, I am still taking advantage to further lighten up my total allotment to stocks.

 

[Markola]

We’re staying at our usual 50/50 but we did increase international equities from 30% to 40% of the equity side this week

 

[Beachcomber]

Looking at the widespread corruption in government and now extending to the stock market, I am thinking of converting to some gold coins, but then you have to worry about where to safely keep it? I know, a safe at home, but still it would be a lot of coin.