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Old 03-25-2020, 05:33 PM   #61
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I think many of us here feel like we can’t sell all our equities for a couple of reasons. 1 - in taxable accounts (which for us is >85% of our retirement assets) you would take a huge capital gains tax hit, reducing what is available to reinvest and 2 - whenever do you get back in?

Therefore, many folks are figuring out what amount of their portfolio they can “ride it out” with. For some folks this is X years of expenses, other folks this is choosing an AA that has Y% in fixed income, and stick with that, letting the equity side ride.

If you realize you are going to be invested for another 20 or 30 years or more, and can cover many years of expenses, riding it out with the rest of the portfolio isn’t so terrifying.
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Old 03-25-2020, 07:29 PM   #62
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Am I the only one buying a few SPY puts at this afternoons pricing?
Thought about it. With the Vix so high it is harder to make money that way.
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Old 03-26-2020, 02:22 AM   #63
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To be fair, you did call it a "dead cat bounce". Unless you are saying the US economy will completely fail, this is not that is. A "dead cat bounce" is a business that is doomed to go out of business and has had a huge drop, but has an uptick on optimism that the business will hang on or it's assets have more value that the stock market cap.

In any case, I am one to stay the course, because I don't have a feel for just how much of a drop this should be causing.


What I meant by DCB was that it was kind of a false rally after a decline. I did not mean to imply that the USA will fail over the long term. I am confident we will recover, I just think there is further to fall before we do. Maybe I used the term incorrectly.
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Old 03-26-2020, 03:55 AM   #64
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I have to admit being surprised by the depth of the market slide. I did nothing to ameliorate my personal financial slide. Heh, heh, haven't even checked my overall stock position - just my favorite Pharma stocks - down, a bit, but not out! Starting with a low (about 30%) stock AA, I have pretty much ignored the market. I am hopeful it will all come back in months to a year or two. Good news: My RMDs will be taken from my GIF instead of my depressed stocks.

Having said all that, I expected the pandemic. I really did. I have a good doctor friend who has traveled the world, helping folks in situations not dissimilar to this one. Having Sunday dinner with her on 26 Jan, she "declared" that this was "going to be extremely bad" and there was not much we could do about it.

Why did the media ignore it for so long? My answer would sound political (even though true.) Of course, YMMV.
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Old 03-26-2020, 04:42 AM   #65
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To be fair, you did call it a "dead cat bounce". Unless you are saying the US economy will completely fail, this is not that is. A "dead cat bounce" is a business that is doomed to go out of business and has had a huge drop, but has an uptick on optimism that the business will hang on or it's assets have more value that the stock market cap.

In any case, I am one to stay the course, because I don't have a feel for just how much of a drop this should be causing.
I've never heard DCB used to refer to a business, just stock, and usually in reference to the market overall.

Dead Cat Bounce
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Old 03-26-2020, 04:59 AM   #66
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I set a buy up yesterday if the stock goes low enough. It has been a solid company in which I already have some shares that pay a very large dividend. Still it is not a lot of money. More like sticking my toe in to test the water. If it does go to my limit or lower I may buy more. Other than that I will stay the course. No need to sacrifice cash in hand.


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Old 03-26-2020, 06:44 AM   #67
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Therefore, many folks are figuring out what amount of their portfolio they can “ride it out” with.

That's something we should have all figured out a long time ago, when we decided what asset allocation would allow us to sleep at night. The only reason I would take action now is if I realized I had been wrong about my sleeping point, but I was confident that wouldn't happen because I wasn't wrong about it in 2008-2009.
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Old 03-26-2020, 06:53 AM   #68
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That's something we should have all figured out a long time ago, when we decided what asset allocation would allow us to sleep at night. The only reason I would take action now is if I realized I had been wrong about my sleeping point, but I was confident that wouldn't happen because I wasn't wrong about it in 2008-2009.
I did mean in the past ahead of this event, although I’m sure people have double checked recently that they still agree with their own “ride it out” plan.
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Old 03-26-2020, 09:23 AM   #69
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To dissect out “how did we miss this,” it might be helpful to look at it from the questions of:
1. What was the thought process that led to a final conclusion that this was going to be really bad, and should be acted upon?
2. How does one equip oneself to recognize this in the future?

This is not a worse version than the flu. This is not even just a deadlier version than the flu. One can read the case series in the medical literature; this virus is terrifying in what it does to the human body. Add to that the transmission by subterfuge and the long lag time to COVID manifestation.
There is no comparable outbreak in modern medicine. Flu is flu is influenza, whatever the strain. Flu v.__ will be a variant of what has occurred and what is understood. SARS and MERS were deadly, but I think even as those outbreaks were occurring, those viruses were better understood than SARS CoV2 today is three months into an outbreak. On top of what I knew that I didn’t know... there were all kinds of extremely disturbing videos leaked out of China.

OP, did you mean how did we miss this in terms of financial or health? This is a wake up call for a virus that kills, say 40% of its victims. How quickly will we react when that one comes to call? I envision, from this virus, a possible lifetime of lung problems. We're still not sure of immunity. And will it mutate to something much worse? Seems as though they have that tendency? Like flu H1N1.



At least health challenges of pandemics are in full view. We now know the actions we have to take. The missed preparedness was adequate PPE. Big mistake. In relation to the markets, the uncertainty drove it to practically collapse. Where's the testing, what is this thing? I had no problem self isolating. Connecting by social media is just fine by me. And we'll ride it out. Global collapse screws all of us anyway. There is no such thing as smart investing if that happens. What's the point if few or no humans are left?


Edit: Good article from 2011 exploring all our apocalyptic possibilities and how we managed to escape doom.
https://www.thestreet.com/personal-f...lypse-11222411
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Old Yesterday, 05:10 PM   #70
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Edit: Good article from 2011 exploring all our apocalyptic possibilities and how we managed to escape doom.
https://www.thestreet.com/personal-f...lypse-11222411
Thank you so much for that uplifting article. My felling on the subject: If the gators don't getcha, the skeeters will, but YMMV.
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Old Yesterday, 05:15 PM   #71
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I have to admit being surprised by the depth of the market slide. I did nothing to ameliorate my personal financial slide. Heh, heh, haven't even checked my overall stock position -
Speaking of which...how many folks haven't bothered to look at their current positions? I thought about it, but I think right now...ignorance is bliss. If I were to see where I stand, it won't change anything since I am still investing and not drawing down any $$$ and if I were to see the decline, I might freak out a little bit.

I did get a *little* good news. Property assessments are out this week and the home assessment has declined enough to save me about $300 this year on property taxes.
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Old Yesterday, 06:11 PM   #72
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Speaking of which...how many folks haven't bothered to look at their current positions? I thought about it, but I think right now...ignorance is bliss. If I were to see where I stand, it won't change anything since I am still investing and not drawing down any $$$ and if I were to see the decline, I might freak out a little bit.

I did get a *little* good news. Property assessments are out this week and the home assessment has declined enough to save me about $300 this year on property taxes.

I haven't looked. I have close to a 50/50 allocation, and stocks are down about 30%, so I'm confident I'd find that my total portfolio is down 15% +/- a bit. I'll take a close look in July which is when I always rebalance.
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Old Yesterday, 07:06 PM   #73
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I got curious about our performance when the DOW hit 18k. Market was down ~25% we were down 9%.

I pulled 2 years of spending out in January for reasons completely unrelated to what’s currently going on. So no need to look again until I need to rebalance on June 1.
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Old Today, 02:56 PM   #74
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The news I follow was reporting on it quite a lot (npr, bbc, wa post, etc...) and knowing my skills at timing the market, I decided to take just a few steps. I saw that some of my previous under performers were at historic and inexplicable highs. I ditched 3 of them netting an average of 6% gain over two years, so moved 80k into spaxx (mm). I had my eye on some I wants as well as two funds I've picked that are even now performing markedly well. So when it tanked last week I bought into them all- but only 50k. I see another opportunity in the near future and I'll buy more of one- 10k maybe.

So far I've bought low, but even with big drops these will all likely recover over the time I have which is 5-10 years before I even have to dip into my IRA $.

Hopefully it'll all work out, but I do not see this situations resolving in weeks or perhaps not for months. Sadly, I made travel arrangements for a trip to Ireland in June. I fully expect that'll not happen. Thank God for travel insurance.

In Houston it is getting scary and I can't say enough bad things about the politicians managing this horror show. We were JUST put into lock-down... Better late than never, I guess.

Stay safe & healthy all.
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Old Today, 04:24 PM   #75
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In Houston it is getting scary and I can't say enough bad things about the politicians managing this horror show. We were JUST put into lock-down... Better late than never, I guess.

Stay safe & healthy all.
Politicians you say. That seems about right. It sounds like they are closing the barn door now that the horse has gone.



Cheers!
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