Dawg52
Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Took care of some minor shuffling this morning. My AA remains conservative.
Procrastinators that were planning on rebalancing out of equities but didn't get to it before COB won today....
Up 8 to 9% TODAY? - wow!
Also I'm targeting absolute $ amounts, not %, and I feel the $ amount of stocks is about right, but I need a lot more $ in cash+bonds. I feel I need to get cash+bonds up to about 5-8 years of spending, and it's much less than that now.
Right. It's the plan I talk about in my threadIf you are comfortable with the equity exposure, I think this makes some sense. In essence, you are saying your cash/bond allocation should be $Z, set to your planned spending ("$x") times Y years, Y being the number of years you expect it to take stocks to recover from a large selloff or bear market.Also I'm targeting absolute $ amounts, not %, and I feel the $ amount of stocks is about right, but I need a lot more $ in cash+bonds. I feel I need to get cash+bonds up to about 5-8 years of spending, and it's much less than that now.
Could be a higher return approach than a fixed percentage, without sacrificing safety.
I rebalance in November. Too many procrastinators, money managers and RMDrs taking profits, losses, and such on either side of the new year.
Is rebalancing easier or more difficult POST ER and why?
Market advanced some more today, pushing more of my covered-call options into the money.
Stocks up 1.20%. Minus loss due to options, and diluted by MFs and cash, portfolio up 0.78%.
Still waiting for the shoe to drop, to borrow from Live and Learn. Any day now, I guess.
I meant the kind of rebalancing where people sometimes claim that "the market rebalanced for me" meaning that equities dropped and got them back to their target allocation. Which is not rebalancing of course. They didn't rebalance when their equities or whatever were high, so they lost the opportunity.If the idea of rebalancing is to reduce the loss if the market drops, then it works for me. In 2017, I picked up an extra 2% return selling options that mostly expired worthless.
If the market drops big, then that 2% would not be enough. If one anticipates that, then severely reducing stock AA would be the only thing that could help. I may still do that tactical AA if things start to look bad.
I wrote several call options with Jan 19 expiry.
If those stocks keep on going, somebody will buy these shares from me at even higher prices than now. That will trim my AA.
If the market bombs, I still have the shares, but the stock AA also gets trimmed due to price dropping.
All done.
Me too.
At some point I will go to a single fund and avoid the re-balancing task. The unfortunate part of a single fund is that withdrawals then come from both stocks and bonds instead of just the better performing fund, but the simplicity will outweigh the advantage at some point/age. Also, you lack more granular control over the equity/income split in a single fund, but I expect that's also OK at some point/age.