I have sinned. I sold

[MichealKnight]

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 I'll start buying ....and keep buying in increments if it keeps going lower.

The cash is earning 2% in the bank account till then, and if a rehab flip house gets reasonable I might buy one.

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 2021.

Don't want to see my remaining holdings tank.....but if SP goes to 3500-3600...I'd really like to start some nice positions.

 

[SecondCor521]

What is your plan if the S&P never returns to 3750 or lower?

Good luck regardless.

 

[MichealKnight]

hi

What is your plan if the S&P never returns to 3750 or lower?

Good luck regardless.

1.)An expletive or two.

2.)If things look somewhat ok - then re-buy.

3.)Be pleased that the other 70% I kept - didn't get crushed and paid a few dividends.

 

[street]

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 I'll start buying ....and keep buying in increments if it keeps going lower.

The cash is earning 2% in the bank account till then, and if a rehab flip house gets reasonable I might buy one.

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 2021.

Don't want to see my remaining holdings tank.....but if SP goes to 3500-3600...I'd really like to start some nice positions.

Will you need the money, is that why you sold?

 

[UnrealizedPotential]

I am not asking for the stocks or the positions you held. What I am asking you is why you had 30% in investments that were volatile. IMO there isn't anything wrong with gambling, provided the amount is kept to 10%, preferably 5 % of assets or less.
As to what you do now, well that is a tough question. I think you should reflect on what brought you to this point. After that, maybe things will become clearer .For what is is worth, I have learned to trust in myself and ignore the noise. After all, no one is GOD and is all knowing.

 

[jollystomper]

One important thing is to figure out what is your "sleep well at night" number.

If the market dropped 30-50% (whatever you think the "bottom" is), what would your holdings look like? If you can sleep with that number, you are fine. If it would get you further worried, you probably should sell more stock now.

 

[ut2sua]

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.

I won't try to call a bottom. S/P 3750 I'll start buying ....and keep buying in increments if it keeps going lower.

On the selling of your stock, you have to do what you need to do to be OK (it sounds like you have mentally prepared for the consequences, whether good or bad).
On the plan to start buying again: lower S/P will come with a bunch of bad/worse news, you may (will) have other thoughts then. This is why it will be so difficult to re-enter once you have left the market.
I don't have a great solution to share since this is a problem that all investors must face.
FWIW, my personal solution is to ignore the short term fluctuations in the stock market. Take a vacation, do more yard work, not checking the investment accounts are the action items for me in a down market. Good luck

 

[Midpack]

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…

 

[levindb]

As others have said, it is important for you to sleep at night. You only realize a loss when you actually sell. You may have lost the dividends your equities were producing while you are out of the market. IMHO you may have had too much equity exposure for your risk tolerance.
Consider that your home value, your home equity, has gone up quite a bit over the past 2 years. Over the past few months, it has begun to contract. Theoretically, you are losing money...do you feel the need to sell your home and rent for a while until prices start going back up?
You appear to be trying to time the market, and in the long term, many studies have shown that is not the best way to prepare or live in retirement.
To atone for your sins, I would recommend spending some time to evaluate your tolerance for risk. What AA would let you sleep at night. While you have a desire to grow your nest egg, your recent transgression suggests you may have been a little heavy in equities, and your real comfort zone may be at a lower level...maybe not 30% lower, but certainly lower than you were.

 

[freedomatlast]

With your stock allocation, you should be thinking more about where will stocks will be the next 10 or 20 years, not what will happen over the next few months. It's always comforting to have some cash on hand to carry you through the times when the market is turbulent so you don't have to sell at a loss or sell based on emotion.

 

[VanWinkle]

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 hope you did that before the losses.....

 

[target2019]

The devil is in the details, as some say.

S&P 500 is 1.6x what it was 5 years ago.

 

[COcheesehead]

The devil is in the details, as some say.

S&P 500 is 1.6x what it was 5 years ago.

Yep. If you don’t like the results, broaden the time frame.

I am up $300,000 since January of 2020 and that includes taking out almost three years of expenses, buying a car, furnishing a new house, some trips…

If I just look at the last 12 months, I’d feel bad too.

 

[TripleLindy]

I almost panicked when the markets tanked because of COVID. I wanted out of equities because, in my opinion, the markets had never experienced anything like that before and at that time, there was no end in sight. My Vanguard advisor talked me off the ledge and actually rebalanced my portfolio to buy into the drop. That day was the bottom. It’s the primary reason I’m still with Vanguard. Market timing is next to impossible, but I can relate. Lots of trouble in Europe, high inflation, rate hikes, supply chain - hard to ignore those strong headwinds. As mentioned above, the challenge will be determining when to get back in.

 

[arcyallen]

It sounds like it's time to make a plan that you know you can stick with. Selling (or buying) due to fear and greed is a hard game to play and doesn't generally work very well. I understand you wanted to stop the bleeding and pain. Now it's time to be honest with yourself and figure out an allocation that you can be happy with. Is it 50/50 stocks/bonds? All bonds? All cash? All real estate? Every one of these allocations has issues, but if you can find an allocation that you can tolerate in all situations it will likely yield you better results...and better sleep.

Question: Do you get stressed looking at the overall portfolio value, or just portions of it? There should be times that each of your investments will disappoint you. I dislike my bond allocation when things are skyrocketing, and dislike my stock holdings when they plummet. But each serves a purpose for me and, taken as a whole, are part of the plan.

 

[mathjak107]

The problem is that the nervous nellies who bail out don’t have balls of steel when it comes to putting it back in .

Markets make their biggest moves way before anything changes .

No one puts it all back in at once , rather they dip their toes and there is the problem …

It is near impossible to predict the best times to be out of the markets .

But catching the few good times is easy , just have it all in .


University of Michigan Professor H. Nejat Seyhun analyzed 7,802 trading days for the 31 years from 1963 to 1993 and concluded that just 90 days generated 95% of all the years’ market gains — an average of just three days per year. miss those few days and you hurt your return .

It is near impossible to not only reliably miss the worst days but it is just as hard to miss the worst time…

catching the best days is easy as pie ... just be invested . NO PREDICTING NEEDED .

 

[HarryHawk]

University of Michigan Professor H. Nejat Seyhun analyzed 7,802 trading days for the 31 years from 1963 to 1993 and concluded that just 90 days generated 95% of all the years’ market gains — an average of just three days per year. miss those few days and you hurt your return .

Thanks for the tip, I'm calling Paine Webber now

 

[aja8888]

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.

 

[Ncc1701]

Next time if you get the urge to sell, you may want to rephrase the title of your post to be: "I have sinned. I locked in losses that would probably be erased two years from now"

 

[audreyh1]

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.

You aren’t looking to get back in.

I expect I will be making the occasional major allocation change as I get older.

 

[tulak]

You aren’t looking to get back in.



I expect I will be making the occasional major allocation change as I get older.

Out of equities?

I’m curious, since the rising equity glidepath per Kitces has been discussed here in the past.

 

[copyright1997reloaded]

The problem is that the nervous nellies who bail out don’t have balls of steel when it comes to putting it back in .

Markets make their biggest moves way before anything changes .

No one puts it all back in at once , rather they dip their toes and there is the problem …

It is near impossible to predict the best times to be out of the markets .

But catching the few good times is easy , just have it all in .


University of Michigan Professor H. Nejat Seyhun analyzed 7,802 trading days for the 31 years from 1963 to 1993 and concluded that just 90 days generated 95% of all the years’ market gains — an average of just three days per year. miss those few days and you hurt your return .

It is near impossible to not only reliably miss the worst days but it is just as hard to miss the worst time…

catching the best days is easy as pie ... just be invested . NO PREDICTING NEEDED .

Have you analyzed how closely clustered those 90 special up days were to similar down days?

 

[aja8888]

You aren’t looking to get back in.

I expect I will be making the occasional major allocation change as I get older.

Recently, I have had a big awakening. Two of my close, long term friends passed away unexpectedly. One was younger, one a couple of years older. One was my weekly golf partner.

I am more worried about staying healthy at this age, although I am in great shape for my age, than I am about "glidepaths" or long term return on equities. My DW is very fragile and has a "death sentence " disease and that's much more of a concern to us than money is.

If I feel like dabbling in equities again, I can still sell put options on stocks I wouldn't mind owning again. And if they get "put" to me, I'll sell call options to have them taken away . But I won't risk big dollars playing that game.

Just having "more than enough" to make it long term with a good lifestyle is comforting to us. Plus, we will leave a nice inheritance for the kids as it is. There comes a time when peace of mind is more important than thinking about glidepaths and a portfolio performance.

I'll take 4% long term now as long term may not be that long anymore.

Our old pal "Imoldernu" made it into his early 80's before checking out unexpectedly. And he did that over 20 years with two owned (small) homes, two old cars, SS (and small pension?), and a few hundred thousand dollars in cash or CDs. He was not ever in the market, and according to his posts, lived a nice retirement.

I'm sleeping well and my golf game is pretty good.

 

[finnski1]

Recently, I have had a big awakening. Two of my close, long term friends passed away unexpectedly. One was younger, one a couple of years older. One was my weekly golf partner.

I am more worried about staying healthy at this age, although I am in great shape for my age, than I am about "glidepaths" or long term return on equities. My DW is very fragile and has a "death sentence " disease and that's much more of a concern to us than money is.

If I feel like dabbling in equities again, I can still sell put options on stocks I wouldn't mind owning again. And if they get "put" to me, I'll sell call options to have them taken away . But I won't risk big dollars playing that game.

Just having "more than enough" to make it long term with a good lifestyle is comforting to us. Plus, we will leave a nice inheritance for the kids as it is. There comes a time when peace of mind is more important than thinking about glidepaths and a portfolio performance.

I'll take 4% long term now as long term may not be that long anymore.

Our old pal "Imoldernu" made it into his early 80's before checking out unexpectedly. And he did that over 20 years with two owned (small) homes, two old cars, SS (and small pension?), and a few hundred thousand dollars in cash or CDs. He was not ever in the market, and according to his posts, lived a nice retirement.

I'm sleeping well and my golf game is pretty good.

All wise thinking IMHO. But what do I know, I'm just a youth of 63

 

[Chuckanut]

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 sold most of my long and mid term bond funds about two years ago when negative interest rates popped up in places like Switzerland and Germany. It proved to be a good move.

Equities? I was not as prescient. :-(