frayne
Thinks s/he gets paid by the post
Haven't done a thing here except to stay the course. In fact I'm looking for buying opportunities.
Op here--I have had a long term plan for 40 years that I have closely followed until now.. But I have never seen an economic situation like we are in now and so decided that my long term plan was no longer working for me. Maybe it was an emotional decision but I think I will sleep much better tonight. Maybe I will stay cash/bonds/ CDs the rest of my life, that might be the best for me at my age (almost 70). But I will probably not. Some day there may be a vaccine or an antiviral and I will get back in the market. Or maybe some day our government will do a better job in managing things and I will get back into the market. We shall see.
...because institution investors with billion of dollars had already beat you to it.
My actions were related to what I see as a very overpriced market that in my opinion has no justification.
And counting on a giant US Government put!Banks, entertainment, travel and energy have taken huge hits, while cloud, certain tech, health care and digital transformation-type stocks have rallied. Whether anyone agrees with the pricing, investors are pricing shares based on relative prospects.
OP here--by the way I am a "she" not a "he" but I guess it does not matter. Back on the issue of municipal bonds in my IRA--I don't have much experience with municipal bonds. One concern I have is that some cities may have to file bankruptcy--how do you tell which munis are safest?
I am in my late 60s and I have been buying mutual funds for almost 40 years. I have had a stock fund/bond fund allocation that I have stayed with through thick and thin--through all the recessions, through 9/11, etc. But today I sold all my equities and moved the money to a money market fund for now (it was all in my IRA so no tax consequences). I have never been a market timer but there is something about the market now that just does not seem right to me. I recouped all most all my losses from March and April and just got out. I don't see anything good to come in the near future and at my age I just decided to not take any more risks.
I will decide what to do with all the money market funds in the near future--CDs? Bonds? Treasuries? but I just don't think stocks are the right place for me to be now.
I sold my stocks already and like others mentioned I feel the market isn't right for me right now (65yr old).
I kinda got the feeling of a turkey being led by grain to the chopping block on Thanksgiving morning. I hope I'm wrong, but I'm glad to be out of stocks for now.
Similar story here... long term investor since 1980s... 64 1/2.... been 60/40 for last 10-15 years. Stayed the course through 1987 crash, the Great Recession, etc. Have been concerned about equity bubble for a year or so but only occasionally trimmed off excess back down to 60%.
This is unlike any crisis that we have seen in my life. My sense is that the economic fallout will be much worse than 2008/2009 but not as bad as the Great Depression... somewhat in-between.
The speed of the drop in March rattled me. While I could have easily held on and not imperiled our retirement (our WR after SS starts is less than 1%) as my portfolio declined towards what it was when I retired at the beginning of 2012 I decided to get out. I was able to liquidate at negligible tax cost due to 0% LTCG rate but effectively used LTCG instead of Roth conversions for 2020).
In 2019 and early 2020 I put a lot of money... currently 47% of total... into CDs with a weighted average APY of 3.13%... about 12% in a preferred portfolio yielding about 5.75% and the rest in cash/ST yielding about 1-2%.
I believe in American business and equities in the long run. At the same time, I'm very concerned that valuations diverge from underlying cash flows due to the Fed's easy money policy propping up equities and creating no great alternatives to stocks, traders doing thier trading thing, underappreciation of the impact of the crisis on the economy, etc.
I do plan to return to equities, but it will most likely be through purchasing long-dated LEAP call options on the SPY if the pricing of those LEAPs ever gets more sensible.
No regrets at all other than a small bit of FOMO.... but I'm convinced that eventually equities will fall back to earth. If not, I still have a very secure retirement (100% success rate in FIRECalc with 60% equities or 0% equties).
OP here--by the way I am a "she" not a "he" but I guess it does not matter. ..
I found this review of Muni from Fidelity's head of Fix Income, to be instructive in getting a foundational awareness of the risk/rewards of Muni
https://www.fidelity.com/learning-center/trading-investing/municipal-bond-market
BTW, just looked at futures for Monday's open and S&P is up 0.5% as of 8 pm pdt.---you may want to cancel your sale and watch how Mon trades. Easy to sell during the day
I was lucky I sold everything I could without tax consequence before the virus hit. I just looked at the years and years of gains and thought it’s enough. My target buy back is when the s&p hits 30% off all time highs. I believe it’s coming, but if it doesn’t that’s ok too.
Here's hoping the negative future numbers turn positive today, and you get out on a sunny day, so to speak.OP here, all the equities I sold were Vanguard mutual funds. The way I understand it is that the sale will be finalized by Vanguard at the end of the day today so I will get any gain or suffer any loss that occurs today.
One that tries this could get out at -10% and get back in at -20%. However, the market does not have to drop to -20%, so what then?I have enjoyed reading all of the replies to this post... I am about 50-50 AA, and have not changed that during this crisis. I did buy CVX at 59, and plan to sell those when it reaches 100 or so.
My only comment about this thread, which several people noted, is this. If you sell stocks, and *ever* plan to get back in, how do you know when? Even if you acknowledge that you do *not* want to try and time the market, you are really forced to... aren’t you?
Anyone else find themselves humming "the first time ever I sold my stocks" to the tune of "first time ever I saw your face"? Just me?