Anyone selling stocks to buy CDs, treasuries?

[COcheesehead]

Looks like 5 yr treasuries are at 4.72% and 10 yr are at 4.51%. Those rates will probably look pretty sweet a couple of years from now. I may nibble a bit on those.

There are 784 investment grade bonds, 5 year duration, on Fidelity right now yielding over 6%.

 

[CRLLS]

Simply stated, if the change to CD's is part of a previous "plan" then go ahead. If it is an emotional reaction to the current situation, then I would stay the course. TBH, I don't follow an AA and don't rebalance periodically. Mine is a long term plan of buy and hold. If the market is good to me, then fine. If the grass is greener somewhere else, then good for those who are there. Truth is, just like racing, there can always be someone who is better than me on any given day or month or year.

 

[Stormy Kromer]

Almost all of our equities will end up in our estate. That's long term money, so no reason to sell. Market timing is impossible, so again there's no reason to sell. Watching the market's short term behavior is nothing more than entertainment; it tells us nothing substantive. So no reason to sell there either.

Make your decisions. Check back in five years to see whether your guesses were right. Some will be. Some won't. But inductive reasoning tells us that equities will probably be up and not by a tiny amount.

Yup.

 

[friar1610]

I try to maintain 50% equities allocation and do not sell anything. In fact, I will buy some stock if equities position drop below 45%.
But I will make sure CD/cash part is sufficient [-]to take me to FRA.[/-]

A lot of the posts in this thread have elements of my plan but this one is the closest (although we’ll beyond FRA.)

 

[disneysteve]

There are 784 investment grade bonds, 5 year duration, on Fidelity right now yielding over 6%.

I only took a quick look at treasuries on the secondary market at Vanguard.

 

[jebmke]

I am not planning to sell equity ever.

 

[audreyh1]

Looks like 5 yr treasuries are at 4.72% and 10 yr are at 4.51%. Those rates will probably look pretty sweet a couple of years from now. I may nibble a bit on those.

Maybe, but I don’t care about interest rate payouts, only total return and rebalancing.

 

[GravitySucks]

Or they just want to change their AA and want to time it opportunistically.

+1. I’ve changed my AA 3 times in 10 years. Happy with my 60/40 now but if I was considering a change I think this would be a good time.

 

[Rianne]

Almost all of our equities will end up in our estate. That's long term money, so no reason to sell. Market timing is impossible, so again there's no reason to sell. Watching the market's short term behavior is nothing more than entertainment; it tells us nothing substantive. So no reason to sell there either.

Make your decisions. Check back in five years to see whether your guesses were right. Some will be. Some won't. But inductive reasoning tells us that equities will probably be up and not by a tiny amount.

I don't consider my strategy market timing. I take every opinion as a good consultation. Many of our major investment, health, and travel decisions were made from the discussions on this forum. Examples:
-Original Medicare + part G
-Sell bond funds and move to CDs and treasuries
-Roth conversion
-When to take SS and why
-Get a limo/driver service in Sicily (didn't even think of that)

Each and every post opens possibilities and food for thought. We're on the fence regarding this major change in our AA. That's why I posted it.

 

[Bigdawg]

Needed some $ over the summer to invest in a friend's business. Turns out they didn't need it so instead of back into equities I'm dumping 90% of it into my 5% CD at NFCU.

 

[COcheesehead]

I don't consider my strategy market timing. I take every opinion as a good consultation. Many of our major investment, health, and travel decisions were made from the discussions on this forum. Examples:
-Original Medicare + part G
-Sell bond funds and move to CDs and treasuries
-Roth conversion
-When to take SS and why
-Get a limo/driver service in Sicily (didn't even think of that)

Each and every post opens possibilities and food for thought. We're on the fence regarding this major change in our AA. That's why I posted it.

Everyone times financial decisions, but there is a group on here and other forums who will chastise you for “timing” the market when in reality rebalancing or pulling out cash, choosing when to take social security etc are all decisions with a time element tied to them.
I think fixed income is very attractive right now and CDs are very safe. Can the yields go higher? Of course. Do you need them to go higher to enjoy your life? That is your personal decision.
I have changed my allocation several times as my situation changed. When I was younger I was 100% equities. As my pile got bigger and my time to recover got smaller, I went more fixed income. Do what makes your plan work.

 

[jazz4cash]

I wouldn’t consider it market timing either.

 

[Chuckanut]

I rebalance yearly. I have no idea what interest rates or stocks will be doing in in the future. If I knew that I would treat you all to a cruise on my 200 foot yacht. But, I don’t know and thus don’t have a yacht. Therefore, I simply rebalance.

I did dump all my mid and long term bond funds years ago when interest rates were pushing to go below 1%. The money was stashed in very low payout money market funds until last year. I suppose that qualifies as market timing.

 

[Jimonlimon]

I sold all my bond funds in March and bought CD's. Then this month I sold my allegedly more conservative and international stock funds and bought more CD's. Now my 401k is about 55% stock funds and 40% CD's. I'll retire shortly (3-8 months out) and start using money so I wanted enough guaranteed investments to weather any market downturns.

I only have one individual stock and it's only 5% of my total.

 

[MichaelB]

> 5 or so years really. I keep my fixed income overall duration to 5 years.

Thanks. Makes sense ..

 

[jollystomper]

For now I have not, but I am only 30-35% equities so do not feel a need to change. However, I have stopped reinvesting dividends in most of my stock funds and that money has been used to purchase treasuries. I had more cash that expected after 5 years of retirement, and some of that "excess" has also been the source of my treasury purchases.

 

[Ncc1701]

Get me 7% on a 10 year CD and I'll start selling....

 

[street]

No.
IMO the market is still the best place to stay invested. CDs are short lived compared to gains in the market for the long haul.

Getting out, getting in, isn't for me and from experience it never has worked out for me.

I plan to stay in that 80/20AA till my last breath and just let it ride the times.

 

[Qs Laptop]

We’re thinking of selling some our stock index funds to buy safe long-term bonds.

We’ll be 66 next year.

Yes, as part of a reallocation strategy related to getting older and also a bit of portfolio housecleaning. It's nice that interest rates are favorable to this move just as I reach this age.

 

[Car-Guy]

Get me 7% on a 10 year CD and I'll start selling....

Anything is possible. Well almost anything. Of course does anyone here remember CD rates back in the early 80's.... Well into the teens. I think some short term rates hit 18.

 

[COcheesehead]

Anything is possible. Well almost anything. Of course does anyone here remember CD rates back in the early 80's.... Well into the teens. I think some short term rates hit 18.

I was in high school and I put all my busboy earnings into a 13% CD. It eventually paid for a car and my off campus housing in college.

 

[FREE866]

I don't get why people get excited about being able to get higher rates on treasuries and CDS. Sure, rates are higher, but that's just in response to higher inflation. The only reason I would include such securities in my portfolio would be to mitigate volatility of the stock market.

 

[COcheesehead]

Yields on many fixed income products are outpacing current inflation.

 

[FREE866]

Yields on many fixed income products are outpacing current inflation.

Yes, but it's all relative. Today, buying a 5 year CD Ladder thats averaging ~ 5% is priced that high due to inflation running at like 3.25% so yeah you can make 1.75% adjusted for 5 years. Maybe a little higher if you shop around I would imagine. Again, its a way to mitigate volatility. Not to get some great return on your money.

 

[COcheesehead]

Yes, but it's all relative. Today, buying a 5 year CD Ladder thats averaging ~ 5% is priced that high due to inflation running at like 3.25% so yeah you can make 1.75% adjusted for 5 years. Maybe a little higher if you shop around I would imagine. Again, its a way to mitigate volatility. Not to get some great return on your money.

Except you really can make 6%-7% or more if you venture into investment grade bonds.