POLL: Miss The 4-5 Years?

Discuss all general (i.e. non-personal) investing questions and issues, investing news, and theory.

Did You Or Didn't You?

Yes, I dumped equities in 08-09, and I'm still waiting to return.
4
2%
Yes, I dumped equities in 08-09, but I've returned.
10
4%
No, I didn't dump, but stayed the course.
252
95%
 
Total votes : 266

POLL: Miss The 4-5 Years?

Postby OverTheHill » Fri May 03, 2013 10:34 am

Of course, it would have been very un-BH to have sold during the crash of 08-09, but I'm curious if there are folks who moved all to cash or fixed and still haven't returned to the equity market yet.
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Re: POLL: Miss The 4-5 Years?

Postby Sheepdog » Fri May 03, 2013 10:44 am

I only had a loss in 2008. The amount I "lost" in 2008 was "found" and then some by late 2009
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Re: POLL: Miss The 4-5 Years?

Postby OverTheHill » Fri May 03, 2013 10:48 am

By the way, I asked this question because I know quite a few wealthy/retired folks who went to cash either on the way down or near the bottom, and they still haven't returned to equities. They lost a lot of money and they keep talking about when might be the best time to return, but they are simply frozen in place. With the new market highs, they are now waiting for a major correction, but the market just keeps going up. This is a case study of why it's a good idea to stay the course, buy and hold.
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Re: POLL: Miss The 4-5 Years?

Postby Sbashore » Fri May 03, 2013 10:51 am

Actually I seem to remember rebalancing into equities in March of 09. I remember it because some friends had gone to cash and I was telling them they should have done the opposite. Those folks are still out of equities and will never return.
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Re: POLL: Miss The 4-5 Years?

Postby jeff1949 » Fri May 03, 2013 10:53 am

So far it's 94% "Stayed the Course".

Did you really expect anything else? :D
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Re: POLL: Miss The 4-5 Years?

Postby MathWizard » Fri May 03, 2013 10:53 am

I rebalanced into equities, but did not see that option, so I selected
stay the course.
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Re: POLL: Miss The 4-5 Years?

Postby OverTheHill » Fri May 03, 2013 10:58 am

jeff1949 wrote:So far it's 94% "Stayed the Course".

Did you really expect anything else? :D

Look, I'll admit it. I came really close to dumping near the bottom, but I didn't. I sure as heck was worried enough to do it, but I just didn't want to put myself in a position of locking in a huge loss. Bottom line: I was just lucky that I didn't give into the urge, which is why I'm a little surprised by the poll results up to this point.
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Re: POLL: Miss The 4-5 Years?

Postby Blues » Fri May 03, 2013 11:00 am

I used the market drop as an opportunity to take losses and move all of my non-Vanguard funds over to Vanguard (except for TSP) where they were promptly reinvested, and happily so. 8-)
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Re: POLL: Miss The 4-5 Years?

Postby nvboglehead » Fri May 03, 2013 11:01 am

I did the Boglehead thing. i aggressively did Tax Loss Harvesting in taxable positions. I sold TSM, bought the Large Cap Index and, because the market kept falling, I was able to go back into TSM with another loss. I also did rebalancing into the equity markets during the crisis. My unrealized gains are now much greater than my realized losses.

Wow, I am so grateful to Saint Jack and this community. I would not have been able to do this without the free knowledge so generously available here.

Thank you,


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Re: POLL: Miss The 4-5 Years?

Postby Bradley » Fri May 03, 2013 11:01 am

Once set I have not made any significant change to portfolio other than dropping small allocation to micro cap and replacing one SV with another SV from another firm. 08-09 did get my attention but having been an avid reader of the “classics” in addition to this board and it’s predecessor I never even considered selling. I do however have a close colleague who dumped everything in Feb of 09 and it has effected his life style to a large degree.
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Re: POLL: Miss The 4-5 Years?

Postby reisner » Fri May 03, 2013 11:03 am

Actually, I was not yet in quite the right funds, so I took advantage of the bottom of the market to sell the wrong ones, buy the right ones, while keeping the same AA and scoring a big harvest of capital gains loss. At the same time I also converted from a traditional IRA to a Roth in expectation of moving from no-tax NH back to California. As Rahm Emmanuel has said, more or less, a disaster is a terrible thing to waste.
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Re: POLL: Miss The 4-5 Years?

Postby reisner » Fri May 03, 2013 11:03 am

Actually, I was not yet in quite the right funds, so I took advantage of the bottom of the market to sell the wrong ones, buy the right ones, while keeping the same AA and scoring a big harvest of capital gains loss. At the same time I also converted from a traditional IRA to a Roth in expectation of moving from no-tax NH back to California. As Rahm Emmanuel has said, more or less, a disaster is a terrible thing to waste.
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Re: POLL: Miss The 4-5 Years?

Postby Boglenaut » Fri May 03, 2013 11:16 am

Actually, you should have added another option...some people overweighed equity.

If I were not a Boglehead and did not have a family depending on me, I probably would have broke my AA and been more aggressive. But with a family that would have been reckless.

As it is, I stayed the course. I bought stocks, but only to the extent planned to hold AA.
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Re: POLL: Miss The 4-5 Years?

Postby Grt2bOutdoors » Fri May 03, 2013 11:30 am

TLH'ed, bought more equity, sold equity, bought more bonds.
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Re: POLL: Miss The 4-5 Years?

Postby allocator » Fri May 03, 2013 11:36 am

I checked "stayed the course" though I probably did so too much. This was before I became a BH, before I knew about TLHing and AA, before I understood the folly of active management, before I knew anything about finding an AA and sticking with it, before I had a clue or a plan.

What all this means is that I did nothing during the financial crisis of 08-09. I didn't buy or rebalance into cheaper shares, didn't sell funds that had been pummeled. I followed the news, took care of my newborn. So I think I managed to miss an opportunity (buying) and avoid a calamity (selling). I'll take it.

Ah, the majesty of inertia :happy
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Re: POLL: Miss The 4-5 Years?

Postby jon-nyc » Fri May 03, 2013 11:45 am

Where's the option for 'i loaded up on equities in 08-09'?
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Re: POLL: Miss The 4-5 Years?

Postby rustymutt » Fri May 03, 2013 11:50 am

You left out buying in during 08/09. Shouldn't that option be listed in your poll? That's exactly what I did, and it's worked out wonderfully. That is after all buying low.
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Re: POLL: Miss The 4-5 Years?

Postby letsgobobby » Fri May 03, 2013 11:53 am

Boglenaut wrote:Actually, you should have added another option...some people overweighed equity.

If I were not a Boglehead and did not have a family depending on me, I probably would have broke my AA and been more aggressive. But with a family that would have been reckless.

As it is, I stayed the course. I bought stocks, but only to the extent planned to hold AA.

I went from 25% in 2007 to 35% in January 2008 to 50% in July 2008 to ultimately 70% by mid-2009. that option is not in the poll!
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Re: POLL: Miss The 4-5 Years?

Postby Boglenaut » Fri May 03, 2013 12:02 pm

letsgobobby wrote: I went from 25% in 2007 to 35% in January 2008 to 50% in July 2008 to ultimately 70% by mid-2009. that option is not in the poll!


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Re: POLL: Miss The 4-5 Years?

Postby Clive » Fri May 03, 2013 12:03 pm

Sbashore wrote:Actually I seem to remember rebalancing into equities in March of 09.

On another board I posted on 31st March 2009 :

At current levels I believe that prices are fair and I'm therefore content to move closer to all-in. Equally however I will be applying downside loss limitation measures against that, along the lines of protective synthetic Puts (Portfolio Insurance) (starting with a small or no short, and adding to that short as prices decline, reducing as prices rise)

Only got up to 90% all-in and it turned out that I never needed to implement the downside protection. But I did miss the bottom by around 28 days :(
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Re: POLL: Miss The 4-5 Years?

Postby billyt » Fri May 03, 2013 12:04 pm

The 2008 downturn really helped me out. I got a very late start. Started investing in 2005 and will retire sometime before this decade is out. So I have been socking away literally every penny. I had a conservative allocation, but nonetheless, it had me directing pretty my all new contributions into stocks in 2008-2009. My allocation has been getting even more conservative over the last 5 years and it currently has me directing all new contributions to bonds and cash. It has worked well for me so far, but I am keeping my fingers crossed. It is nice to have these big gains, but it also makes me a little nervous.
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Re: POLL: Miss The 4-5 Years?

Postby johnep » Fri May 03, 2013 12:04 pm

I dumped about half of my equities in late 2008 but gradually added them back the next 2-3 years. Admittedly this was a mistake. I suspect others did this as well and it seems there should have been an option for a partial dumping of stocks
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Re: POLL: Miss The 4-5 Years?

Postby letsgobobby » Fri May 03, 2013 12:41 pm

Boglenaut wrote:
letsgobobby wrote: I went from 25% in 2007 to 35% in January 2008 to 50% in July 2008 to ultimately 70% by mid-2009. that option is not in the poll!


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Re: POLL: Miss The 4-5 Years?

Postby jon-nyc » Fri May 03, 2013 1:04 pm

johnep wrote:I dumped about half of my equities in late 2008 but gradually added them back the next 2-3 years. Admittedly this was a mistake. I suspect others did this as well and it seems there should have been an option for a partial dumping of stocks



Indeed, large numbers of investors did that, which pretty much explains why the market dropped in 08-1q09 and has been rising since.
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Re: POLL: Miss The 4-5 Years?

Postby Clearly_Irrational » Fri May 03, 2013 1:05 pm

I was still doing active investing back then so I didn't just dump my longs I went short the market. It worked out rather well thank you, though I do wish I had known about options back then. I didn't quite catch the bottom but I got pretty close. I have a mostly passive approach nowadays, though I still have some trading rules based on real interest rates and the PE10.
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Re: POLL: Miss The 4-5 Years?

Postby barnaclebob » Fri May 03, 2013 1:12 pm

I remember having a majority of my assets in a savings account (saving up for a house down payment) and wishing I could go all in when the Dow was in the 6,000s. I didnt know anything about taxable investing at the time but if I had I probably would have been mostly in short term bonds because they would have likely been better than a savings account.

Didn't touch my then low 5 digit 401k.
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Re: POLL: Miss The 4-5 Years?

Postby otbricki » Fri May 03, 2013 1:15 pm

How about dumping equities in 2007 and then dollar cost averaging back in starting in 2008?

I guess I got lucky. My other market moves haven't been as good.

But since then I became a Boglehead so it's pretty unlikely I'll try that sort of thing again.
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Re: POLL: Miss The 4-5 Years?

Postby abuss368 » Fri May 03, 2013 3:23 pm

OverTheHill wrote:Of course, it would have been very un-BH to have sold during the crash of 08-09, but I'm curious if there are folks who moved all to cash or fixed and still haven't returned to the equity market yet.



We did for the first time what we never did before (because we used to think we were smarter than the market). We stayed the course!

We continued to invest and are very pleased with the results and thankful to earn our fair share.

Thank you Mr. Bogle!
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Re: POLL: Miss The 4-5 Years?

Postby rr2 » Fri May 03, 2013 3:38 pm

I only started to put serious money starting in 2008. Before that my accumulations were not a whole lot.
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Re: POLL: Miss The 4-5 Years?

Postby MnD » Fri May 03, 2013 4:03 pm

I took at least two half-days off in 2008 and 2009 using paid time off to calculate rebalancing buys in various accounts, identify and make tax loss harvesting pairs in taxable and other such fun. I recall one such morning I was so full of coffee and nerves (the market was down ~700 points as I was buying gobs of ETF's ) that I pretty much "pitted out" my shirt with sweat and had to take another shower before going to work. Good times! :mrgreen:

Does that count as "stay the course"? I did stick to my AA.........
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Re: POLL: Miss The 4-5 Years?

Postby Dulocracy » Fri May 03, 2013 4:16 pm

In reality, we have to realize this poll may have some bias in it. Those who are proud of staying the course put it out there. Those who did not... just do not respond. I say this not because I doubt Bogleheads. I say it because so many on this site came here after that point in time, from what I read. I would be surprised if there were not a lot of people who dumped, lost, and do not want to say so in this poll.
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Re: POLL: Miss The 4-5 Years?

Postby MnD » Fri May 03, 2013 4:38 pm

My co-worker went from 100% S&P 500 to 100% cash when the Dow went under 7500.
I asked him what he was doing lately and he claimed he had "gotten back in" but was very vague about when and into what.
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Re: POLL: Miss The 4-5 Years?

Postby Leesbro63 » Fri May 03, 2013 4:46 pm

I can't cite the exact thread, but Rick Ferri clearly stated in 2008-9 that it (the crash) was probably the last big opportunity for babyboomers to turbocharge their retirement funds, he turned out to be super right, at least so far. My negative side tells me that this is all a borrowed and printed bubble. But my positive side tells me that even if it is, it will probably play out in an unpredictable manner and a diversified portfolio is the best anyone can do without speculating and risking a bet that loses it all (like Peter Schiff, for instance..at least so far). I didn't have the guts to rebalance in 2009 because I was afraid of rebalancing into poverty had the DOW gone from 6666 to 3333. (Pascal's Wager) But I'm glad I held what I had. It was the single hardest psychological thing I've ever done. Anyway, Rick Ferri appears to have been the "most right" that it was time to act as if it was business as usual, rebalance, and ignore the noise. I guess I'll give myself a "B" for not selling but not an "A" because I was afraid to rebal.
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Re: POLL: Miss The 4-5 Years?

Postby texasdiver » Fri May 03, 2013 4:59 pm

I stayed the course with auto monthly deposits into the same vanguard target retirement funds through the whole thing. Kept telling myself it was a great buying opportunity.

What I did do is stop peeking so dang much that is for sure. I just stopped wanting to know.
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Re: POLL: Miss The 4-5 Years?

Postby noyopacific » Fri May 03, 2013 5:26 pm

While 94% responded that they didn't dump their equity funds in 08-9, I recall a news article from the time that does support this. I recall it was reported that Vanguard's equity funds were having the least amount of outflows of the major fund families and that during that time, most other equity funds were experiencing significant outflows. The article suggested that Vanguard clients appeared to be the most disciplined and experienced of investors.
- I'm pretty sure the writer also commented that Vanguard clients are the fittest and most attractive too! ;-)
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Re: POLL: Miss The 4-5 Years?

Postby SpaceCommander » Fri May 03, 2013 5:27 pm

2008 was an epic year for tax loss harvesting in my taxable portfolio. I'd been carrying those capital losses forward over the last few years, until I sold some rental property in 2012 for a nice gain and used those capital losses to offset my gains. Made a nice fat profit on that rental property too (which I bought in California during the bloodbath in 2009). Win/Win. :mrgreen:
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Re: POLL: Miss The 4-5 Years?

Postby Scooter57 » Fri May 03, 2013 5:36 pm

My course did not involve having a lot of equity in 2008. I held what I had, but was very happy to have most of my money in CDs and the MMF.

I've upped my stock percentage target this past year as I have more assets, but I'm taking my time getting to it. I'm not a gambler, I have enough for my forseeable needs, so I'll stick with the cautious strategy I'm most comfortable with.
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Re: POLL: Miss The 4-5 Years?

Postby Atilla » Fri May 03, 2013 5:40 pm

Stayed the course more or less.

What really horks me off is my wife was unemployed from November 2008 thru May 2009. So no 401K deposits for her, not much additional taxable purchases during that time (held onto cash for that time - cash was king right then) and didn't do our full IRA contributions for the year.

But - we didn't panic and didn't sell except for tax loss harvesting. Took losses in January and re-bought in Feb/March. That worked out well. :moneybag
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Re: POLL: Miss The 4-5 Years?

Postby Peter Foley » Fri May 03, 2013 6:41 pm

I pretty much stayed the course with some rebalancing into equities. I simply could not do the last rebalance in early 2009 when the market dropped and went though the S&P 500 rebalancing band of 800. My calculation was such that w/o a market recovery I might have to work an additional 3-5 years. I did not want to take that chance. Had I stuck to my plan I would have come out at least six digits better. Another lesson learned in risk tolerance. On the other hand I came out just fine. Hindsight is usually 20/20.
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Re: POLL: Miss The 4-5 Years?

Postby otbricki » Fri May 03, 2013 7:01 pm

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Re: POLL: Miss The 4-5 Years?

Postby tacster » Fri May 03, 2013 8:36 pm

In 2008 I had never heard of Jack Bogle, and was 100% S&P 500. The only thing I did right at the time was not bail out, and continue making regular investments. Of course I didn't rebalance since I didn't know what that was and had no bond funds anyway. At some point during that nightmarish time I just resigned myself to being unable to retire for who knows how many more years, and simply quit watching the market. Now five years later and I'm ready to retire early next year. Funny how things work out sometimes. :beer
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Re: POLL: Miss The 4-5 Years?

Postby Scooter57 » Fri May 03, 2013 8:37 pm

Peter Foley,

There was no way of knowing that the market would come back, so what you did was wise in your circumstances. If things had gone the other way--which they might have--you would have regretted putting you retirement money back in the market.

I fear that the events of 2008 may have taught a lot of people that ALL market drops recover quickly. That could come back to haunt a generation of retirees who are abandoning the traditional conservative investments long believed appropriate for our later years.
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Re: POLL: Miss The 4-5 Years?

Postby grabiner » Fri May 03, 2013 10:04 pm

I have been 90% stock (and with risky stock) since 2004, so I lost 60% in the market decline. I didn't get back to my 2007 peak portfolio value until 2011, and that only because I have continued to add to my portfolio. I don't compute an internal rate of return, but I would guess I finally broke even in 2012.

My only sales in the bear market were to harvest losses and to rebalance; in October 2008, I had too much in bonds and sold a bond fund in my retirement accounts to buy more stock.
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Re: POLL: Miss The 4-5 Years?

Postby Grt2bOutdoors » Fri May 03, 2013 10:08 pm

Another reason to hold more fixed income - I use and will continue to use Grabiner's experience as a warning of what happens when you take on more risk in search of returns.
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Re: POLL: Miss The 4-5 Years?

Postby bayview » Sat May 04, 2013 12:00 am

The other day, I cautiously printed out my quarterly statements through that fun-tastic time to see what I had done. I was pretty proud to see that I never dumped equities, which is what I had wanted to remember, but just watched in patient resignation as things played themselves out. (I'm just too cheap to sell low.)

I even maintained my allocation through most of it, picking up some bargains, before chickening out and going all G and F funds in new contributions for a while, but by golly, I didn't sell. :D
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Re: POLL: Miss The 4-5 Years?

Postby yukon50 » Sat May 04, 2013 12:35 am

Yes, I missed most of it. I had the worst possible timing and lost my job in 2008 and then was unemployed for a while and traveled for a while. Terrible timing and missed most of the good buying opportunities. Now I have decent income and have to pay much higher prices. Ugh.
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Re: POLL: Miss The 4-5 Years?

Postby Ed 2 » Sat May 04, 2013 12:53 am

here is my link
viewtopic.php?f=1&t=55171

I been called that I was "too aggressive ..." by some famous characters on this forum.....the rest of story.
My portfolio now doubled since. :happy
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Re: POLL: Miss The 4-5 Years?

Postby BHCadet » Sat May 04, 2013 1:54 am

tacster wrote:In 2008 I had never heard of Jack Bogle, and was 100% S&P 500. The only thing I did right at the time was not bail out, and continue making regular investments. Of course I didn't rebalance since I didn't know what that was and had no bond funds anyway. At some point during that nightmarish time I just resigned myself to being unable to retire for who knows how many more years, and simply quit watching the market. Now five years later and I'm ready to retire early next year. Funny how things work out sometimes. :beer

Ditto... :sharebeer
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Re: POLL: Miss The 4-5 Years?

Postby HardKnocker » Sat May 04, 2013 6:55 am

I made the wrong decision to flee the market in 1987 after Black Friday.

I try never to make the same mistake twice.
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Re: POLL: Miss The 4-5 Years?

Postby nisiprius » Sat May 04, 2013 8:52 am

I hated 2008-2009. I was scared. I was worried. I found myself saying things like "please please, if the Dow ever gets back to 10,000 I'll just sell everything and not get into the stock market again every." The extent of my visceral reaction was larger than I expected. It wasn't just a drop in some numbers, it was watching talking heads like Ben Bernanke and Henry Paulson on TV and realizing that they were scared. It was the period of time when just when you had started to stop feeling panicky because some giant household-name been-there-forever firm had collapsed, there would be screaming headlines about another having collapsed.

It turned out that I was awfully close to my risk tolerance, but I didn't have too much in stocks and I didn't actually do anything. I definitely did not expect the stock market to come back as quickly or as far as it has, and during the 2010, 2011, and 2012 there were several times I was worried as to whether some pullbacks might be the start of another crash. And I'm worried now about whether things are going too well. In short, I'm always worried, but I've been staying the course. I didn't sell in 2008-2009. And when the Dow did get back to 10,000, of course, I didn't sell then.

And right now I'm a little worried about my Vanguard Total Bond Market holdings--but I'm staying the course.
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