Time to buy? What are you buying?

[RobLJ]

Buying

Wednesday, I used 8% of cash to buy Fidelity S&P Index and Vanguard Total Market.

Tuesday and Thursday in the taxable account I sold some Closed End Bond funds that I bought in Jan in order to tax-loss harvest and picked up roughly equivalent positions in similar funds.

Today, I started small positions in Prudential and PPL, which look very cheap.

I decided to start putting cash to work when the drop was 25-30%, then every drop of about 5%, put another 3-5% to work. Hopefully we hit bottom before I run out of cash. I'm keeping at least 20-25% of my cash position (it was 30%) for the next two year's withdrawals. I took 2019 gains in Jan and Feb, so the cash position was unusually high and my stock allocation was close to 40%, which is too low.

 

[Daniel J]

I started rebalancing this week but am I taking it slow as I suspect further declines are likely. 1% on Tuesday, another .5% today.

 

[Markola]

Our Target Date Funds rebalance nightly and our Vanguard advisor rebalances quarterly if bands are exceeded so zzzzzzzZZZZzzzzz. Boring is best.

 

[Montecfo]

Unless you're an active trader and buying and selling stocks to make short term profits, I just don't understand the wisdom of buying at this moment for the long term. Unless you have a crystal ball or you're attempting to time a bottom, wouldn't it be more wise to wait to see how this coronavirus thing plays out? My gut feel is that even with the government bailouts, we're headed for a big recession or worse, depression. I'm not criticizing your decisions to buy just trying to understand your logic.

Be greedy when others are fearful. The market is discounting a recession. I have been buying (in small positions) because I do not know where the bottom is.

 

[pb4uski]

Unless you're an active trader and buying and selling stocks to make short term profits, I just don't understand the wisdom of buying at this moment for the long term. Unless you have a crystal ball or you're attempting to time a bottom, wouldn't it be more wise to wait to see how this coronavirus thing plays out? My gut feel is that even with the government bailouts, we're headed for a big recession or worse, depression. ...

+1 I've pared down my equity position over the last week or so. I think it is really hard to assess how deep and wide this recession is going to be and the market is just guessing, so I'll trade some conservatism for some upside. I just have a gut feel that this recession is going to be a nasty one and there is so much uncertainty it is difficult to assess the impact on business and the economy. What the Fed has done with interest rates to artifically prop up the stock market is also a concern as is the high proportion of market activity that is just traders doing their thing.

On the upside, our retirement portfolio is about the same in total as when we retired 8 years ago after funding 8 years of living expenses plus buying a winter condo (10% of retirement date balance) and replacing our one-car garage with a two-car garage with a bonus loft (2.5% of retirement date balance)... so we are still well positioned... about 14% ahead of where I projected we would be at this time when we retired.

I'm thinking of this as a "time-out" to reassess our risk appetite and AA going forward and once that is decided, how to catch that falling knife without getting cut.

I'm also mulling over perhaps using a portion of portfolio income to buy LEAPs or at-the-money or slightly out-of-the-money SPX index calls to capture equity returns to mitigate inflation risk rather than direct equity investments.

 

[audreyh1]

I’ve been tax loss harvesting some legacy active funds. I keep it allocation neutral which means I buying the corresponding index fund same day.

I didn’t think I’d get this kind of opportunity to do a clean-up, but had planned for it if the opportunity arose. It should mean lower taxes in the future.

 

[David1961]

I’ve been tax loss harvesting some legacy active funds. I keep it allocation neutral which means I buying the corresponding index fund same day.

I didn’t think I’d get this kind of opportunity to do a clean-up, but had planned for it if the opportunity arose. It should mean lower taxes in the future.

You mean you are selling some of your actively managed mutual funds to take these capital losses and putting the money into index funds? That is a great idea. Just want to make sure I understand. Even at the market peak, my cost basis would not have generated as much capital gains as I thought, since I pay taxes on the distributions each year.

 

[cooch96]

VTSAX. I’ve invested about 25% of my dry powder this week. I expect we’ll see the market bottom in weeks, not months. We might even already be there.

I must say, it’s easy to be sanguine about this catastrophe. Traffic is blissfully down, and the few people I do meet are all civil and polite. No looting or panics in my neck of the woods. DW did get terminated from her temp job yesterday, but I was expecting that.

 

[rkser]

Lots of activity in my portfolio lately.

Buying VTSAX in taxable mainly on days S&P is down at least by 100 points & also some Total International Stock Index. There have been lots of those down days recently.

I am cognizant that Market will go down more in the coming days

I regretted not buying in 2008-2010 Market downturn & saw the Bull Market since. I have more time being (Seasoned??) in the Market since, although I know that may not be repeated.

I am 63, was 56/46 before the downturn & am now around 48/52 & my goal is generally to be around 50/50. I will be in the Market for another 15 yrs or more, so I think (although can be flat out wrong) I have a reasonable chance to see it recover & go to new heights. USA probably will not be another Japan

I have put in some from our savings but more from Tax Exempt Intermediate Bond(in taxable) & did the Roth Conversion from VBTLX to VTSAX. So more of re balancing from Bonds into VTSAX & some new money into VTSAX.

Funds for our living expenses for next 10 yr or so will be coming from Bonds & Cash. Well, this can be called Market Timing, but am not selling Stock Funds anytime soon.

 

[Golfquest20]

Be greedy when others are fearful. The market is discounting a recession. I have been buying (in small positions) because I do not know where the bottom is.

This

 

[mrfeh]

We are outside of our rebalancing bands, but are still waiting for things to stabilize a bit before buying equities.

I'd be amazed if we see a V shaped recovery. I think we're either going further down or sideways for a while.

 

[COcheesehead]

The wild card is if governors issue orders for non essential workers to shelter in place. That will bring almost everything to a halt. That may be our moment of capitulation.
I have tax loss harvested out of everything I can and that was a couple weeks ago. Might have been my best move. I have been picking up AAA select muni’s at yields I haven’t seen in years.
There is plenty of time to buy equities. This will be the worst market of our lives. I am in no rush.

 

[ownyourfuture]

I’ve been tax loss harvesting some legacy active funds. I keep it allocation neutral which means I buying the corresponding index fund same day.

I didn’t think I’d get this kind of opportunity to do a clean-up, but had planned for it if the opportunity arose. It should mean lower taxes in the future.

AAA+++

 

[jazz4cash]

The wild card is if governors issue orders for non essential workers to shelter in place. That will bring almost everything to a halt. That may be our moment of capitulation.
I have tax loss harvested out of everything I can and that was a couple weeks ago. Might have been my best move. I have been picking up AAA select muni’s at yields I haven’t seen in years.
There is plenty of time to buy equities. This will be the worst market of our lives. I am in no rush.

I think it’s already happened in most places but the definition of essential worker could become more restrictive and it seems enforcement is a problem. I agree....plenty of time to buy equities. I’m considering a muni bond purchase and have no idea how market will play out for these. Bonds that typically have zero availability are at par vs +12 a week ago.

 

[Tiger8693]

I think it’s already happened in most places but the definition of essential worker could become more restrictive and it seems enforcement is a problem. I agree....plenty of time to buy equities. I’m considering a muni bond purchase and have no idea how market will play out for these. Bonds that typically have zero availability are at par vs +12 a week ago.

Yes. I am not sure how the enforcement will be done. Arrest and lock up with all of the other violators in a 10x10?

 

[GreenEggs]

I've been studying the charts, screeners, insider trading lists, & the news for everything that appears interesting. Then I ran them all through the portfolio visualizer to see how they performed over various timeframes. It's very interesting to see how they compare. Some of the popular FANG stocks weren't as impressive as I'd have assumed.

I'm a beginner at this, so I've just been guessing about how to utilize online data. What info do most of you folks consider important when choosing long-term stocks?

 

[CaliKid]

I've been adding National Health Investors, Inc. (NHI) REIT
It was 90$ less than a month ago & trading at $40 today.
(no, it didn't split)

I have not heard of the company but just looked them up. Looks interesting. They seem to be in a good space (medical and senior housing) which should be good for a long time. Without knowing anything I try to guess why it dropped so much more than the market as a whole!? If anything it seems medical should be good. You have any insight or thoughts on it?

 

[CaliKid]

Think there will be a glut of commercial property on the market in a few months. Ever had the desire to own a nice motel? I've read the suggestion that many of the folks who thought airBnB places would cover the mortgage and expenses and give a nice cash on cash return are going to be in the hurts as travel stays drop. I'm wondering,morbidly, about how many people are going to tough it out too long and croak it in their homes. Images of mummified little old couples in their little old homes.

I think it will be a lot longer than a few months. At this point the properties can be sold and returned to single family use. Values are still up at this point. It's not like 2008-2010 when prices had dropped so severely. In fact, in many markets I own in we are just back to the 2005-2006 peaks. Lots of the airBnB types (short term rentals or STRs) were bought between 2010 and the present so most have equity if they sell.

Now, actual commercial properties might be different. I wouldn't want to own a retail strip center right about now. Even people that own multi-family buildings are worried as they don't know if people are going to pay the rent on the 1st. Time will tell.

In all, I think it will be a long while before there are incredible buying opportunities in real estate. Just my two cents....

 

[11522914]

Puts are very expensive. So I just recently started selling cash covered puts in my IRAs. Usually I sell at a strike price 10 to 20% below the stock price. That way if the stock goes up I lose the opportunity but keep the expensive put premium. If not I just bought the stock cheaper.

Recently sold puts on T, XLE and JETS.

Ended up getting T at 29 (had sold my position recently at $37.25) and JETS at 13.

Had another lower strike JETS and XLE puts expire so I got to keep the expensive premium.

Haven't sold puts on SPY but most likely will this week. I'm currently at ~9% equities so this is how I will slowly get up to 35% - which is my goal. It's best to sell them on a strong down day as they get ridiculously expensive. But even on recent up days they still are quite expensive.

 

[mrfeh]

I'm a beginner at this, so I've just been guessing about how to utilize online data. What info do most of you folks consider important when choosing long-term stocks?

Please read this before you do anything:

https://www.bogleheads.org/wiki/Bogleheads®_investing_start-up_kit

 

[accountingsucks]

Futures limit down again. I think we see 20% drop tomorrow

 

[ESRwannabe]

Okay, I decided today to start putting some of my money back to work. This morning I purchased shares of C, CMG, MAR and V.
Is anybody else dipping their toe in and if so, what are you buying?

So far I have made purchases of:

WFC, BAC, C, JPM, T, MPC, KMI

(*) I figure the major banks are actually some of the safest companies to own this time and that the Fed has their back. The banks have very strong balance sheets. IMHO the government is going to prevent as many people from defaulting on loans as possible and give free money to people to pay their bills.

(*) With AT&T I believe they will be ok as people will hold onto their cell phones, and internet access for as long as possible. Also people that have money for it, will gladly pay for HBO, WarnerBrothers, etc content while they are stuck at home with nothing to do. T does have a lot of debt, but they paid off like $30 billion in 2019. Their free cash flow is beefy. I think the come out of this ok.

(*) I make my case for owning MPC over on this thread:
https://www.early-retirement.org/forums/f44/oil-biz-102744.html
For similar reasons I have a small position started in KMI.

Luckily for me I work in infrastructure IT and my employer actually needs my skills more than ever with everyone working at home now. Also I work for a very stable employer anyway. So I am not worried about my w-2 income. So, I will be pouring every cent I can into more stocks.

P.S. Also I could survive off of my dividend income from my taxable account if I had to (roughly $22k). Assuming of course that dividends are not cut, which I feel pretty confident none will be. Might even get some raises.

 

[FIREd_2015]

I've been sitting in cash/short term securities the last several years watching the market reach one all time high after another. I've been following the margin data on finra.org and latest data as of the end of Feb is at $545.1 billion. That's a lot of borrowed money and I think there are a lot of margin calls yet to come. I've dusted off Metastock and started charting SPY, SSO and USO. I'm waiting for another 20-30% drop from these levels before getting back in. One of my posts from a while back was about stop playing when you've won the game but if SPY drops another 20-30% drop from these levels I think the risk to reward ratio is starting to look pretty attractive and I would start playing again.

 

[brewer12345]

Sacks of wheat and pearled barley, a bunch of powdered milk, and some cans of dried onions. Oh, and have a few pounds of black powder too.

Seriously, let things calm down first. Lots of potential to get hurt here. I suppose if we see s and p at 1500 I will not be able to resist, but it would be better to fi d the bottom.

 

[aja8888]

Seriously, let things calm down first. Lots of potential to get hurt here. I suppose if we see s and p at 1500 I will not be able to resist, but it would be better to fi d the bottom.

This is some good advice here.

Besides the economy crashing side of this, and the slimy, finger-pointing politicians at war with each other, the "market" can go down a lot farther. And it could take a very long time to recover.