Normally I don't ask for advice but

[veremchuka]

This afternoon I turned on CNBC at 2:59 PM and when I heard the DJIA was a few points from a 4+ year high I turned it off at 3:04 PM, you know what that high means! This way I couldn't do anything, I don't know how the market closed.

My "problem" is I have 37% in equities and 63% in fixed income. I want my AA to be 50/50. I want to take some profits off the table - Vanguard TSMI up 23% in almost 2.5 years and the Vanguard REIT up 27% in just 54 weeks but I don't want to rebalance because I want my equity allocation higher. If I exchange from either of these 2 funds I am locked out from repurchasing them for 60 days.

So I (oh boy here it comes!) think we have topped out (see the bold above) and are due for a pull back and would like to take the profit and then get back in after a pullback but the 60 day restriction may well prevent that.

I could exchange into say the S&P 500 and a SC fund to try to replicate the TSMI but I don't want to own funds for a short time and get a bunch of funds showing up on my statements when I just have TSMI, TISMI, GNMA, REITs and High Yield Corporate Bond. KISS but how to capture the profit and then up the equity portion?

Any ideas?

ETA I don't understand how to buy ETF's I do understand the nav of a mutual fund. Etf's would be a solution but at what price are you paying? This is why I stay in mutual funds.

 

[LOL!]

I'm not quite sure I understand what you want to do.

You want to sell equities now because you think the run-up is flagging, but you want to buy equities now because you want to be at 50:50? Is that what you want? If so, you cannot do that.

I exchanged from S&P500 to bonds recently. I certainly am poorer than if I did not do that.

 

[braumeister]

Just because prices are going up doesn't mean they won't continue to go up.

I think you may be falling victim to the market timing fallacy. Better to just reallocate according to your plan, and ignore current events.

IM [extremely] HO

 

[Cut-Throat]

Here is what I did about 5 years ago. Pick the asset allocation you would like and invest it all in a Target Retirement Fund. I never have to think about my portfolio again. My best moves over the last 20 years have been to do nothing.

Now, I truly have nothing to do.

 

[LOL!]

One reason to have accounts at multiple financial institutions is that you don't need to worry about trading restrictions. Sell Vanguard TSMI in account A, then buy TSMI in account B the next day. Easy.

Even with ETFs held at a single vendor, you may have problems because the settlement is T+3. One has to avoid "free riding" (google it) if you do not have a margin account.

 

[GrayHare]

ETFs trade like stocks. If you have a brokerage account, you can buy/sell ETFs like you would any stock.

 

[haha]

So I (oh boy here it comes!) think we have topped out (see the bold above) and are due for a pull back and would like to take the profit and then get back in after a pullback but the 60 day restriction may well prevent that.

Go for it amigo, the world is your oyster!

 

[pb4uski]

You are trying to be a dirty market timer.

Rather than try to market time and sell equities and buy them back later, given that you are underweight, you should just develop a plan as to the time period that you want to get to 50/50 and then move money from fixed income to equities periodically to get to 50/50.

You could be dead wrong and equities could continue going up as the equity markets improve and the sheep return.

May the force be with you.

 

[REWahoo]

So I (oh boy here it comes!) think we have topped out (see the bold above) and are due for a pull back and would like to take the profit and then get back in after a pullback but the 60 day restriction may well prevent that.

DMT!

 

[LOL!]

So even though the DJIA is near a 4+ year high, you have to realize that if it goes higher from here, every single day will be at new intermediate term high. Then it will go past the all-time high which will disturb some folks. Then every day higher will be a new all-time high. This could go on for months or years, so the media will be filled with these statements from now on.

So the only answer is to ignore the news of "a new high" and use other criteria such as your asset allocation, rebalancing, and tax-loss harvesting to make decisions.

 

[W2R]

So even though the DJIA is near a 4+ year high, you have to realize that if it goes higher from here, every single day will be at new intermediate term high. Then it will go past the all-time high which will disturb some folks. Then every day higher will be a new all-time high. This could go on for months or years, so the media will be filled with these statements from now on.

And I will be yelling "WHEE!!!!! Wheee!!! wheee! wheee" the whole time, until I am hoarse and then lose my voice, falling into a giddy little heap...

Do not trust the Wheee... just enjoy the Wheee!!

 

[MichaelB]

And I will be yelling "WHEE!!!!! Wheee!!! wheee! wheee" the whole time, until I am hoarse and then lose my voice, falling into a giddy little heap...

Do not trust the Wheee... just enjoy the Wheee!!

Uh-oh

 

[steelyman]

And I will be yelling "WHEE!!!!! Wheee!!! wheee! wheee" the whole time, until I am hoarse and then lose my voice, falling into a giddy little heap...

Do not trust the Wheee... just enjoy the Wheee!!

You do that one more time and I will be forced to post a GEICO commercial. For now, I will just say: "W2R! You're home!"

 

[FIREd]

And I will be yelling "WHEE!!!!! Wheee!!! wheee! wheee" the whole time, until I am hoarse and then lose my voice, falling into a giddy little heap...

Do not trust the Wheee... just enjoy the Wheee!!

I rebalanced this morning. Bring it on!

 

[W2R]

Not only that, my portfolio is at (yet another) all time high... while living off of it!

 

[Onward]

due for a pull back and would like to take the profit and then get back in after a pullback

You're kidding, right?

 

[NW-Bound]

To the OP: You can go ahead and sell. The Oracle of New Orleans just gave you permission.

Uh oh, you didn't put in the order before the market close today? Oh man, Monday is going to be a bloodbath. Oh gosh! I did not sell anything either. We are going down together, my friend.

 

[Moemg]

I skimmed off some profits Tuesday !

 

[Nords]

And I will be yelling "WHEE!!!!! Wheee!!! wheee! wheee" the whole time, until I am hoarse and then lose my voice, falling into a giddy little heap...
Do not trust the Wheee... just enjoy the Wheee!!

Cool. I'll be selling calls on Monday...

 

[samclem]

So even though the DJIA is near a 4+ year high, you have to realize that if it goes higher from here, every single day will be at new intermediate term high. Then it will go past the all-time high which will disturb some folks. Then every day higher will be a new all-time high. This could go on for months or years, so the media will be filled with these statements from now on.

So the only answer is to ignore the news of "a new high" and use other criteria such as your asset allocation, rebalancing, and tax-loss harvesting to make decisions.

Exactly. There's nothing about a "new high" that is any different from any other number--it has zero impact on what stocks will trade at tomorrow, next week, or next year.
Pick an allocation and either re-allocate all at once or slowly over time (if it will help you sleep better).

 

[easysurfer]

I agree with the others about not drawing conclusions from outside factors you can't control.

My strategy is to rebalance to my target allocations only once a year.

With that, I barely even noticed that I new high was reached.

But I confess, afterwards, I did peek at the value of my investments.

 

[Tyro]

Regardless of where one thinks the market may be going, there are arguably some valid reasons to make a lateral move now (or soon).

Take taxable gains now: Independent financial advice (NAYY)

Tyro

 

[foxfirev5]

Reading this post I had to take a look. Even with the run up I'm only slightly above my AA of equities and I have not close to my 5% rebalance band. There's nothing to do at this point. I like keeping it simple.

 

[marko]

One way to think of it is that the new four year high is about where the market should have been 3.9 years ago were it not for the crash.

One could argue that there is still some catching up to do. Interesting logic for sure, but some charts suggest a nice run up is overdue.

 

[Tree-dweller]

Do not trust the Wheee... just enjoy the Wheee!!

+1. Eloquently put...but I'm no market-timer.