I have sinned. I sold

[Markola]

S&P 500 is -10% for 1 year. That doesn't make me feel bad.



Going into retirement 2.5 years ago I had gradually set our investments to 50/50 AA. I did that recognizing the worst drawdown on various AA ratios. IOW, I accept what happens and don't make strategy changes.



I realize every one is different. I can only offer what we do as an example. It's just talk.

Same. 50/50. In our case, at 56 and 59, our effort to be as ready for anything as we can be includes being globally-diversified in index funds. Plus we have home equity we could do something with someday, if necessary. And we intend to take SS at age 70. Long term care insurance. And we have a 2.5% speculative investment at the margins. And we still work just a little. Finally, we just take the long view and leave it all alone to cycle.

 

[JJpop]

If it makes you feel any better, I sold all my bond funds and put all of that allocation in treasuries. Biggest sell of my life…

I did the same thing except for one defined maturity etf.

 

[maestro]

After today, and the carnage in markets, your sins are forgiven. You are sleeping well tonight. Take the cash and max out your I-bonds at 9.6%. Simple math. Why not T-Bills at 3.5% as well? Good luck, God bless.

 

[EdL3]

Thanks and these are pretty much the bullet points of my life and have been for the last 17 years. Wealth without health is meaningless.

“Wealth without health is meaningless”. I hope you don’t mind if I adapt that as my new slogan.

 

[EdL3]

Thanks and these are pretty much the bullet points of my life and have been for the last 17 years. Wealth without health is meaningless.

“Wealth without health is meaningless”. I hope you don’t mind if I adapt that as my new slogan.

 

[MichealKnight]

9/17

I've read and reread everyone's replies and I greatly appreciate it - always keep them coming. Again - I sold 30% of my stock holdings meaning. 70% - I'm a sitting duck just like everyone else. I just needed to hedge SOME - as I just can't sit around and tell myself "Hey I harvested tax losses!" and "Hey I dollar cost averaged!" and tell myself it's a good thing. If the baseball tickets I bought for $100 today are $90 tomorrow - I'm sorry - but - that sucks. So selling 30% of paper assets - just trying to salvage a bit. If everything goes up - ok I missed returns on 30% - but i'l get them on 70% - I'm ok with that. Since selling on or slightly before 9/8....I've only used a little of the cash generated:

Goog: Sold it at $110.01. I've bought HALF it back @ 102.00. I didn't wait - they own the internet, and the internet - owns the human race. Have buy orders in for $98.00 and $95

Apple: Sold it at $154.00 Bought HALF back $150. Next buy order is for $145 - fully realize I might miss some big announcement but oh well but that's also why I'm buying it back rather fast.

.SDY: Sold for $125.00 Bought half back @$120.50

HD: Sold for $299.10 Bought half back @ 270.00. Next order is in for $265 and then $260

New position: FDX@ 156 (Half of what I eventually want to hold)

New position: BA@. 145. (Again, half of eventual position)

New Position: FSR @ 8.75 (Speculation. Hoping a model eventually gets sold, and the Chipotle Kids in newsrooms start another round of saying "EV! EV! EV!" and this gets a bump. On that note - I sold NO GM and Ford and VW and Benz for that very same reason.





Many more buys to go but at this point my buy prices are too low.

The above - hardly some genius money making. However - on that money, losses reduced by 2-10% - nothing life changing...but it saved me some money - money, that spends just fine. Also - if its ok to be ok - with 'tax losses' and 'dollar cost averaging' - - well, I feel ok that I might contain or reduce some losses on 30% of my investment capital.

Of course, the carnival barkers on Wall Street shouting "intrinsic value!" "strong buy!" "It's a great company!!" "Great Management!" "Look at these cool green charts!" still got me to ride the elevator down with the remaining 70% of my stocks so I guess I'm team player that way. (Mind you in the humble companies I owned and operated - over-ordering retail merchandize without even THINKING that things might change, OR giving glowing remarks just 2 months ago and then saying the world sucks........... I or my team rarely did that and still we didn't think of ourselves as "Great Management" - we just felt its common sense the average kid running a lemonade stand might know. I wasn't 'great management' with any fancy degree - just someone who had almost 100% of his net worth vested in something I also operated - took personal - and each day I felt I got paid (0r not) what I was worth. Ditto my team.

If it declines more it will be painful to see. But, I'm trying to look on the coming months as a nice buying opportunity that might yield to nice returns over the next 5 years and in the meantime - IBONDS, Treasuries, even CDs flirting with 4%.... looking very interesting to me.

 

[target2019]

To each his own.

 

[Bamaman]

Yes. The last time I was up rather high - I wanted to be a prudent holder and I held. And now - temporarily I'm worth $300k less.

Over the last week on good days, I've sold 30% of my stocks. If things rebound hard now - oh well I missed some of it.

If things get rough because of random little things like higher rates,Fed tightening, labor shortage, Europe enjoying "going green" thanks to certain energy shortages, China Taiwan, Venezuela, earnings per share coming down, etc...then I'd love to re deploy it.

I won't try to call a bottom. S/P 3750

They say I'm losing money with cash. I dunno, I didn't lose $300k with cash - but I did holding stocks at my apex at end of .

Down $300K? Consider yourself lucky. Many of us on here are in far worse shape. But we were up 300% from 2008 prior to this year, so we're still fortunate..

 

[arcyallen]

Yes. The last time I was up rather high - I wanted to be a prudent holder and I held. And now - temporarily I'm worth $300k less.

Last week there was a huge 1300 point drop. People thought they lost a bunch of money. And they did. Kinda.

Except that in the previous week the market had gone up...you guessed it...about 1300 points. So despite the headlines screaming "Meltdown!", people broke even for the week.

When Black Monday hit in 1987, it was a one-day 22% drop. Looking at that day, it was the end of the world. Look at the month, it wasn't that bad. Stand back and look at the year, and...you guessed it, they again broke even.

So my question for you is...are you really down $300k, or are you breaking even? I'd guess you might even still be ahead..

 

[MichealKnight]

Good question

Last week there was a huge 1300 point drop. People thought they lost a bunch of money. And they did. Kinda.

Except that in the previous week the market had gone up...you guessed it...about 1300 points. So despite the headlines screaming "Meltdown!", people broke even for the week.

When Black Monday hit in 1987, it was a one-day 22% drop. Looking at that day, it was the end of the world. Look at the month, it wasn't that bad. Stand back and look at the year, and...you guessed it, they again broke even.

So my question for you is...are you really down $300k, or are you breaking even? I'd guess you might even still be ahead..

I"m down , for real. I was never into paper assets and stocks and 401K stuff until I early retired. So I never rode the elevator up that much. The stock account - down $300k.

And I'm pleased that at least 30% of my stock allocation didn't participate in last week's festivities. If it skyrockets now - oh well I still enjoy it on the other 70%. But - I just don't see the inflation number being handled that quickly. Labor, supply chains - complex problems that will take awhile - and then I feel the new normal will be 4% inflation not 2 like the Fed claims it wants.

Many used to shout platitudes '$15 an hour!!" "businesses exploiting workers!" - - well guess what, now workers are telling businesses to stick their $15 somewhere special...point being, cost of labor will stay somewhat high and with any luck - labor in China, India, Mexico are gonna figure it out also.

Club 401K's life is gonna change a bit.

The shareholder - is gonna start sharing.

Part of me thinks it's hilarious for reasons probably not popular on this forum so I won't go into it.

Part of me wishes it didn't have to happen when I finally got into this game

 

[target2019]

My interpretation now is that MichaelKnight is looking for an asset allocation that works for him.

 

[VanWinkle]

Between November and December of last year, I sold 90% of my equities, mostly preferred issues, some tech stocks, and took good profits. All were in an IRA.

In January 2022, I sold my only bond fund. As interest rates rose through the year, I took the cash and started buying treasuries, CD's, Corporate bonds and agency notes in the IRA. In my brokerage account, I bought several municipal bonds, an MLP, and another energy stock.

I am 10% equities across the board and ahead about 2% YTD in 2022. I am almost 79 and moving into fixed income in a big way. I still own several energy equities (XOM, WMB, etc).

So I guess I should be criticized for selling like MichaelKnight above.

No, you're just exceptional.... either lucky, good, or something else....

 

[SecondCor521]

My interpretation now is that MichaelKnight is looking for an asset allocation that works for him.

Based on post #56, it seems to me that @MK is now an active investor. Not my cup of tea, but YMMV.

 

[Chuckanut]

Many used to shout platitudes '$15 an hour!!" "businesses exploiting workers!" - - well guess what, now workers are telling businesses to stick their $15 somewhere special...point being, cost of labor will stay somewhat high and with any luck - labor in China, India, Mexico are gonna figure it out also.

A few years ago there was a big movement in my area to raise the minimum wage to $15 an hour. Several cities passed laws to do phase in the $15 wage over a few years. Reality hit. Long before the $15 hourly wage became official law many fast food joints were advertising starting wages over $15. I do live in a high cost of living area.

On a recent out of state trip I noticed that even in lower cost of living areas the starting wage is $14 an hour. I also noticed more of those kiosks where the customer enters her own order. One Big Name fast food joint had a sign on the register recommending people use the kiosks for faster service. The register human being was reserved for people with questions and special orders (Can i get my burger without mustard and with more onions?)

 

[MichealKnight]

could be

My interpretation now is that MichaelKnight is looking for an asset allocation that works for him.

Could be. I've merely lowered stock allocation - and wish to get back to it - when I feel they are a bit cheaper, OR if the downturn never happens.

I just felt that - I'd rather lose less money. I like keeping it if I could.

Frankly I regret not having the guts to sell 100% of it. I'm downright angry with myself.

Only silver lining is if I get to buy it all back cheaper.

 

[MichealKnight]

Will be fun

A few years ago there was a big movement in my area to raise the minimum wage to $15 an hour. Several cities passed laws to do phase in the $15 wage over a few years. Reality hit. Long before the $15 hourly wage became official law many fast food joints were advertising starting wages over $15. I do live in a high cost of living area.

On a recent out of state trip I noticed that even in lower cost of living areas the starting wage is $14 an hour. I also noticed more of those kiosks where the customer enters her own order. One Big Name fast food joint had a sign on the register recommending people use the kiosks for faster service. The register human being was reserved for people with questions and special orders (Can i get my burger without mustard and with more onions?)

I wonder - is there a HUGE segment of America that doesn't live in Club 401K-WhileFoods Ville? People who didn't or couldn't get more educated? People who didn't have the upbringing to even fill out a job application or speak in sentences?

Now that the kiosks, and "digital" and "automation" will go more mainstream - did these people just lose their sole ticket into the workforce to learn basic habits?

If said people get even poorer..... what will they do?

*Be happy. Volunteer to clean the oceans and pick up litter.
*Build Habitat for Humanity houses.
*Be resentful, angry, and in some cases - violent.

"$15 an hour!"

Some bumper stickers - result in unintended consequences

 

[MichealKnight]

Could be

Based on post #56, it seems to me that @MK is now an active investor. Not my cup of tea, but YMMV.

If, keeping 70% of one stocks in place - while having a pretty good idea that they are going to depreciate again is being an active investor, ok, yes that is what I am.

I dunno. I could buy butter today. I have plenty in my fridge.

But usually around thanksgiving - butter goes from $4.50 to $2.99...I wait to buy at that time, and buy enough to last till summer.

Does that mean I'm timing the market? Does it mean that people posting about "when will car prices go down" are market timing? Why don't people say "just go buy a car, pay full MSRP, if prices go down in 6 months, just dollar cost average and buy a new one. "

To me it's just - - trying to keep more money.

Again, kept 70%, only sold 30%.

 

[VanWinkle]

If, keeping 70% of one stocks in place - while having a pretty good idea that they are going to depreciate again is being an active investor, ok, yes that is what I am.

I dunno. I could buy butter today. I have plenty in my fridge.

But usually around thanksgiving - butter goes from $4.50 to $2.99...I wait to buy at that time, and buy enough to last till summer.

Does that mean I'm timing the market? Does it mean that people posting about "when will car prices go down" are market timing? Why don't people say "just go buy a car, pay full MSRP, if prices go down in 6 months, just dollar cost average and buy a new one. "

To me it's just - - trying to keep more money.



Again, kept 70%, only sold 30%.

You are timing the market. It works, rarely, but if it works for you I think it is great. Good luck and let us know when you get back in. When purchasing a stock/fund that over time appreciates in value, it is not comparable to a car or butter.

Best to you,

VW

 

[SecondCor521]

If, keeping 70% of one stocks in place - while having a pretty good idea that they are going to depreciate again is being an active investor, ok, yes that is what I am.

[snip]

Again, kept 70%, only sold 30%.

I was not referring to your OP where you sold 30% of your stocks.

I was referring to post #56, where you, in the approximately 10 days after that, purchased seven different individual securities (not sure exactly what .SDY is - maybe an S&P500 put option?).

It seems clear to me that you're taking active measures to try to preserve and grow your money. Cool, I wish you good luck.

I'm not trying to be critical with my description. I do think it's accurate based on what you've written on this thread.

 

[DJRR]

I"m down , for real. I was never into paper assets and stocks and 401K stuff until I early retired. So I never rode the elevator up that much. The stock account - down $300k.

This. When you have done it for 40 -50 years you may have a different opinion. I used to think the same way, but learned that a fund that did the opposite of what I did would perform much better You will see that the moves come much faster than your brain is willing to commit your actual money to. This market is just noise. It has been a long time since a truly volatile market where is was moving a few % a day. Once this one decides where it is going it will be a rocket down or up and the human brain is not really able to pull the trigger. If you are using other peoples money then it is easy to gamble on the moves.

I am convinced that it is impossible to daily compete in liquid stocks like Google that are being traded by computers and huge funds betting other peoples money. These same factors make it possible for smaller people to compete in illiquid markets or places where they have a knowledge advantage/market information. The only problem is that is a lot of work, JOB, there is no free lunch.

Congrats on the good call. People like Peter Lynch, Bill Miller, and Warren Buffet have managed to make good calls for a decade or so. Most others learn bad habits that lead to underperformance, even before fees. I have learned that the market average less low expenses is enough to meet my objectives YMMV.

 

[Rianne]

We've had our highs and lows with the stock market and mutual funds. I won't be devastated if we break even. Kind of like going to the casino. At our age, I just want preservation and some interest. I look back at December 2021. I thought "YEY" we can spend more and be comfortable. Now we'll spend the same and be comfortable. No debt, a few vacations a year. NBD. We're so much luckier than most.

 

[target2019]

My interpretation now is that MichaelKnight is looking for an asset allocation that works for him.

Could be. I've merely lowered stock allocation - and wish to get back to it - when I feel they are a bit cheaper, OR if the downturn never happens.

I just felt that - I'd rather lose less money. I like keeping it if I could.

Frankly I regret not having the guts to sell 100% of it. I'm downright angry with myself.

Only silver lining is if I get to buy it all back cheaper.

I agree with "could be." However, when you sell into an inflationary period, and buy back later if inflation continues, will you incorporate that into your backtest?

What can be debated is how much you actually lost. Their is difficulty in appraising this going forward. You point out that there is possibly a loss of future gains. To that you entertain another move to get back in, and so on.

It's your hard-earned money and you are entitled to whatever strategy you like. Some day you may find the asset allcoation that does not cause you to make sudden market moves. Maybe not.

Enjoy the ride.

 

[aja8888]

No, you're just exceptional.... either lucky, good, or something else....

No, I am getting real old and decided to move more towards fixed income in the face of the FED bubble that has been blowing up during the last 12+ years.

We are starting to see that bubble deflate as the FED tries to control the inflation they started. I was investing in 1980 and saw the earlier version of what's to come.

People around me are dropping like flies and I am now the oldest in the family. Long term to me is maybe 10 years (Mom made it to 84 before her kidneys failed, Dad left earlier).

 

[daylatedollarshort]

No, I am getting real old and decided to move more towards fixed income in the face of the FED bubble that has been blowing up during the last 12+ years.

We are starting to see that bubble deflate as the FED tries to control the inflation they started. I was investing in 1980 and saw the earlier version of what's to come.

People around me are dropping like flies and I am now the oldest in the family. Long term to me is maybe 10 years (Mom made it to 84 before her kidneys failed, Dad left earlier).

We're younger than you but feel the same. If "market timer" means I don't ignore the writing on the wall when inflation is 8 - 9% and the Fed says they are going to raise interest rates 7 times, them I'm pretty happy to be called a market timer. We've actually had a pretty decent year this past year, with less stocks, selling the bond funds, a pile of TIPS offsetting a low interest rate mortgage and buying more short term Treasuries and TIPS. Our goal is not to make a killing in the stock market in retirement, but if we can live well and leave the portfolio value intact in inflation adjusted dollars for our kids, I would be happy with that outcome.

 

[MichealKnight]

Timing the market? Yes - 30% of it. I've merely sold 30% hoping to avoid fun. 70% - is still in place, waiting to lose more value.