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Old 02-02-2018, 11:36 PM   #61
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You say it's only a paper moon
sailing over a cardboard sea.....
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Old 02-03-2018, 12:30 AM   #62
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Maybe. Maybe not.

There were people not paying attention today, so this weekend they will have a chance to see what happened to their portfolios.

One group will say, "OMG! I lost a ton and need to get out."
Another group will say, "OMG! Buying opportunity!"

We won't know which is the larger group until next week.
Buying monday (so everyone else should probably wait and watch it go down even more due to my luck!)
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Old 02-03-2018, 01:49 AM   #63
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Well, I guess we are finally out of that dreamy la-la land where the market always soars upwards, day after day. Time to get back to the real world.
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Old 02-03-2018, 03:37 AM   #64
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Yeah well it isn't a loss unless you need to sell. I see a buying opportunity
down is down , realizing a gain is a tax able event .

there is no difference between closing a position each night and buying the same asset or even another in the morning vs keeping the same money in play over night in the same investment .

there is no such thing as only a loss on paper . if you fell by 50% your net worth is down 50% . it may come back or it may not . setting draw rates is based on portfolio value not whether you sell or not
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Old 02-03-2018, 03:49 AM   #65
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Yawn. It’s all noise in the long term...
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Old 02-03-2018, 04:11 AM   #66
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How long has it been since we saw a 5-10% correction? (of course corrections sometimes turn into bears.)
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We had a very powerful correction from July of 2015 through Feb of 2016. It coincided with the crash in oil prices.

I think in August alone it dropped 10%, but it didn’t stop until Feb 2016.
I looked at my diary. Audrey has good memory.

On 2015/07/20, the S&P was at 2128. On 2015/08/25, it was at 1868. That's a 12.2% drop.

It climbed back up to 2078 on 2015/12/29, then crashed down to 1829 on 2016/02/11. That's another 12% drop.

But from 2128 in mid 2015 to early 2016, the total drop is only 14%.

The S&P did not regain the high of 2128 until July 2016. So, it's one year of no gain, which is not really that bad.

If one set his rebalance band at 10%, he could have made a few bucks (or not).
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Old 02-03-2018, 04:17 AM   #67
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Originally Posted by mathjak107 View Post
down is down , realizing a gain is a tax able event .

there is no difference between closing a position each night and buying the same asset or even another in the morning vs keeping the same money in play over night in the same investment .

there is no such thing as only a loss on paper . if you fell by 50% your net worth is down 50% . it may come back or it may not . setting draw rates is based on portfolio value not whether you sell or not
What you said is true, and I agree.

However, when I say "loss" instead of loss, I was referring to giving back some of the recent excessive gains that I did not really deserve.

Still, I prefer to keep all of that undeserved gain. I fail because I am just not a good market timer. How else would I want to lose a 6-figure sum in one week?
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Old 02-03-2018, 05:10 AM   #68
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one thing i learned is at any point in time it is all your money the same as a bank account . it is just that investments have a variable balance .

but there is no such thing as it is the house's money . in fact i started in 1987 . today that money is a 7 figure portfolio . if i go by the term the "houses's money " i can lose 98% of my money and call it okay because it wsn't my money .

investors thinking things are only paper losses can make for some poor decisions .
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Old 02-03-2018, 05:13 AM   #69
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Yawn. It’s all noise in the long term...
i hope at this age we have a long term lol .

the problem with bear markets is while they recover in nominal terms fairly quick , real returns are another story . we have had quite a few recoveries in nominal terms that were fairly short but actually took more than a decade in dollars to recover . waiting a decade just to break even at 65 can be rough .

but we all invest , hope for the best and keep our fingers crossed
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Old 02-03-2018, 05:22 AM   #70
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Yawn. It’s all noise in the long term...
+1 If I hold my chart at arm's length it still looks like a straight line upward. This morning I see that while I was 7 months ahead of my 7% plan, I'm now still 2 months ahead of plan.

Last night, out with friends, I picked up a dinner check for $600 and didn't think twice about the market.

Cash flow-wise, we live off our dividends; the monthly yields came in just fine on Wednesday morning--and will also at the end of this month.
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Old 02-03-2018, 05:35 AM   #71
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Talk about undeserved gains, I may want to take back what I said.

Investing is always perilous. Ideally, the market should go up a steady (insert your number here) 3-4% after inflation. But it doesn't. It goes up 20-30% one year, then drops 10% the next. And so, the occasional outsize gain is to make up for lousy years, such as after a "Wh***".

If the investor jumps in/out at the wrong time and loses money, it's his fault, or at least he does not know how the market works. If he stays in, he is compensated for the patience.

OK, I know how the market works. But can I do even better, meaning conquering greed and fear to buy when others are scared, and sell when they are greedy? Should I not get compensated for being the contrarian trader to provide market liquidity, to be the other side of the trade for those greedy/fearful people?

I looked at my own performance in the above mentioned period of July 2015 to July 2016, when the S&P dropped 14% from 2128, then climbed back up to the same point almost a year later.

It was not that great. I made 1.5%. Hah! That's about the same as the S&P dividend, given my AA. Actually, I should have made a bit more, because my cash also has some low yield to add a bit of return.

While I have a daily log of the total value of my investable accounts, looking up and back analyzing all of my trades would take a lot more work. But I do remember repositioning most of my energy stocks to something else. They made good money for me the previous years, and hanging on to them would mean giving back all that gain.

Hence, the trades I made in that flat year were still good moves. They could have been better, if I did not hang on to those energy stocks that long.
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Old 02-03-2018, 06:03 AM   #72
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We have never sold when the market was down, we used fresh cash from employment to balance things out. We are now retired and next year I have to pull a RMD. Trying not to outthink myself!
Saving was way easier than drawing down but we are damned glad we have something to draw down.
My guess is, some of those 401-k millionaires who were publishing account statements on social media ( who does this ?) may be in for a queezy ride.
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Old 02-03-2018, 06:29 AM   #73
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If this turns into a real correction I will rebalance and get back into an irrationally exuberant mood.

So what is the opposite of "WHEEEEE." We need a slogan and an icon to toss around when bulls are stampeding.
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Old 02-03-2018, 07:01 AM   #74
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so what is the opposite of "wheeeee." we need a slogan and an icon to toss around when bulls are stampeding.
eeeeew?
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Old 02-03-2018, 07:29 AM   #75
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investors thinking things are only paper losses can make for some poor decisions .
In other threads I keep seeing people say they "don't want to lock in losses," which is a similarly meaningless concept. Your portfolio does not have memory (except for taxes) and does not know how it got to where it is today. Today's portfolio is all you have.
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Old 02-03-2018, 07:42 AM   #76
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exactly , it is all your money . like working on commission it varies but it is yours to take at any point .whether you choose to or not does not change the value
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Old 02-03-2018, 08:25 AM   #77
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Returned from a month out of town thinking I'd rebalance on Friday.
No need now. Left everything alone. I try not to do anything when CNBC is playing Its The End Of The World (and I feel fine.)
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Old 02-03-2018, 08:27 AM   #78
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Last night, out with friends, I picked up a dinner check for $600 and didn't think twice about the market.
Hi, Uncle marko...

I'm glad you're still able to have a good time at your advanced age. But, I'm concerned that maybe your spendthrift generous ways might be cutting into my inheritance. Please be careful.
Your most devoted and loving nephew...
redduck
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Old 02-03-2018, 08:52 AM   #79
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This thread reminds me of the threads and posts in October of 2007 and the flak I encountered when a member posted that he was already 100% in stocks and wished he had more money to invest after the “correction” of the first few days of October — the stock market had fallen in the summer about 10% and then rose back to the level it had been and began to fall off in October and I merely posted that is how markets top, when everyone who wants to buy has their stock quota. By 2009 most of the confidence had been eroded by the large losses, however the bond component really kept portfolios from disaster. There is an extreme confidence in stocks issued throughout this thread that is interesting to me from a investment indicator view. The anguish of 2009 has been utterly vanquished, though our hero’s at the Federal Reserve still bear the weight of 4.5 Trillion in debt purchased (equal to 60% of all US government debt issued at our optimistic outlook of October 2007) they used to pull us upon their shoulders from the mortgage mania investing malaise, and no dispersal of the burden of that debt appears to be forthcoming.

I am not predicting anything nor changing my investing portfolio any more than I had since last fall, however since 1981 we have lived in one of the truly great investing periods of all times, there have been major declines to be sure but the stock losses were met with new all time highs in every case in a very intermediate investing term with steadily falling interest rates and declining inflation along the way to always cushion a portfolio that was invested in stocks/bonds. If you do not have retirement money it is pretty much indicative as having been unable to save as virtually any investment style with even a very moderate risk profile has seen positive returns to inflation.

With good fortune for us all this will continue for another 37 years, for if there is another downturn, I don’t know if the FED will have a free hand to reach down and purchase 8 trillion of bonds to save us as they did in 2009. If Atlas shrugs it will be a new world and it will no longer be the FED’s problem.
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Old 02-03-2018, 09:07 AM   #80
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