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DrPayItBack

The problem with this thinking arises from the fact that in order to take advantage of a drop, you have to keep ‘cash on the sidelines’ rather than staying fully invested, and this has been shown time and again to be a suboptimal strategy.

DrPayItBack

Buffalo chicken dip!

DrPayItBack

Hopefully you have a written plan that tells you what to do in these situations, so you don’t have to make the decision emotionally and predispose yourself to regret.

DrPayItBack

‘Index except for everything that has recently performed poorly’ is a pretty profoundly bad way to invest.

DrPayItBack

rustymutt wrote: ↑Sun Apr 19, 2020 6:26 pm Good for you. We're out also. Don't let the investment porn drag you down. This market is going lower. But maybe slower than normal. The economy is hosed.

And the market kept going up and they were never heard from again.

DrPayItBack

There have been voices saying that index funds are bad investments for years. The reason they are an excellent choice is no less true today than it was in 2015, or 2011, or 2007.

DrPayItBack

Amen. I'm more worried that I'll lose my job doing 'elective' procedures than I am worried the market will fail to recover. So using this opportunity to build the emergency fund I probably should have had all along, and otherwise just keep shoveling in money and living beneath my means.

DrPayItBack

I know this from personal experience. I didn't ever waver during the financial crisis from 2007-2009, but it didn't feel good for very long. I started out feeling defiant and confident, and ended up grimly determined and waiting to see my losses turn back into gains. It took a long time. This is wh...

DrPayItBack

You aren’t going to know it’s ‘trending back up’ until it’s already happened and you’ve missed the boat. Do you think there is a signal that goes ‘ding ding ding,I’m trending up!’? I would keep a look out for a slow down in new covid-19 cases. Currently we are experiencing exponential spread rates....

DrPayItBack

You are saying ‘rebalancing’ when you mean ‘panic selling’

DrPayItBack

What is your contingency plan, if instead, the market drops to a bottom of 22% and then continues to go up from there, at what point will you buy back in? Or, if the day after you buy SQQQ, the market stops dropping and continues to upwards for the rest of the year? If you're going to do this, you ...

DrPayItBack

My annual income increased from ~$65k to ~$440k this year, so yeah, I’m feeling this a bit.

DrPayItBack

They can't withdraw from Roth without having been on deposit for more than 5 years (I think 5 years is still correct). So just a high yield bank account or CDs is all I can think of. I do think it’s silly to put money in an IRA with the express intent of taking it out before retirement, but what yo...

DrPayItBack

Not really. I just want to see how things play out with the virus. My focus is on events, not the market dropping a certain % or showing stability by rising a certain %. When things stabilize so that we have a good handle on the effects of the virus, I'll get back in -- higher or lower, doesn't rea...

DrPayItBack

anonsdca wrote: ↑Mon Mar 02, 2020 10:43 pm Based on the threads the last fews weeks, I doubt most posters here have any kind of IPS or strategy.

I think you’re just seeing that the most fearful people (and those with the most cognitive dissonance) are the loudest.

DrPayItBack

This last week has really helped me be certain that I can live with this investment philosophy, and I think I am glad to have had this test of resolve. I used the opportunity to shift a small amount of one fund which I was planning on shifting at the beginning of the month anyways. Otherwise, I do ...

DrPayItBack

Pseybert wrote: ↑Mon Mar 02, 2020 9:36 pm As of 4PM, I am 100% cash/bonds. 34 years old. Yes, I know timing the market is a bad idea. Yes, I know this could cost me hundreds of thousands of dollars in the future and I may never know when to "get back in". Whatever, I'm shooting my shot. Don't be like me.

So weird

DrPayItBack

Why not pick an asset allocation you can actually tolerate (which clearly isn’t 100% stocks) and lump sum into that. Much simpler.

DrPayItBack

Should have spent on a 0% card to start with. When I opened my chase freedom unlimited, I had a $23k limit and 18 months at 0%.

DrPayItBack

Agree, risk tolerance is the key. And it can change depending on all sorts of things. For instance, lets say you work in the typewriter industry. Your risk tolerance might change as your job contracts. Or you get a large bonus - this gives you more cushion and may alter your risk tolerance. Bear ma...

DrPayItBack

Here’s something for you. I know that stocks are going to get pummeled this week. Absolutely know it. There is so much delusion right now about market impacts and it has been building pressure all weekend. I think the Dow will be down over a thousand points again on Monday again. I don’t just think...

DrPayItBack

Yes, there is a subtle negative tone to people who pulled out or assessed risk tolerance and rebalanced out of stock before major decline. If they get back in, then theyve done very well. Its not "stay the course" but its a black swan that came up. Your continued misuse of the vocabulary ...

DrPayItBack

Sorry, but it’s definitely timing, just like everyone else panic-selling. You aren’t different, unfortunately. I'm sticking to my plan: sell when the market falls below the 300 day moving average. I don't see what I gain by riding this out. And what could you possibly lose with a system that tells ...

DrPayItBack

Since I didn't act quick enough, I suffered some losses, but I feel pretty confident that things are going to get worse, before they get better, so I'm glad I at least got out now. The important thing is that you’re “pretty confident” now, as opposed to totally clueless like you were a whole week a...

DrPayItBack

I expect to start selling on Monday. The S&P breached its 300 day moving average on Friday. I don't think this will all be settled until a vaccine comes out. That's 18+ months out. There will be plenty of time to buy back in. My buy back in criteria is either greater than the 300 day moving ave...

DrPayItBack

Thanks. It's painful to sell now. I have 6 - 9 months. Also, my entire IRA account is in cash. Is it a good time to shift money in into an Index funds -- maybe in stages? You really need to write out an investing plan and stick to it. Preferably one that doesn’t involve investing money you need in ...

DrPayItBack

Read About Bob, The Worst Market Timer What happens if you only invested at market highs? http://awealthofcommonsense.com/2014/02/worlds-worst-market-timer/ j :happy It is a cute story. I'm still waiting for someone to write about Bob-san, The Worst Japanese Market Timer. He puts money in back in 1...

DrPayItBack

... I understand I am using "adjust AA" as a means to market time. I should not do that because it does confuse the issue. I would think we all agree the "you have not lost anything until you sell logic is flawed." Therefore, even if you are an investor and not a trader there ca...

DrPayItBack

This thread has been a good read. I met my risk tolerance last week and returned to cash. This was a very un-Boglehead action. I too felt as though the Coronavirus would continue to impact markets negatively a few weeks ago, but stayed in as that was what I planned to do from the start. I've only b...

DrPayItBack

I felt there were plenty of reasons to adjust AA since mid January. This is the issue, and it's how you continue to demonstrate that you haven't quite 'gotten' the purpose of an asset allocation. An AA is not something you are meant to adjust on the basis of the 'news of the day'. It should be some...

DrPayItBack

MnD wrote: ↑Sun Mar 01, 2020 8:57 am
DrPayItBack wrote: ↑Sat Feb 29, 2020 3:33 pm Selling after a rapid decline is always the right answer.
You can make a small fortune using that approach - starting with a large one.

Love this, going to remember that one.

DrPayItBack

My plan says to go to a more aggressive asset allocation if there is a substantial drop in equities. Last week I was at 68/32 or so. Yesterday I moved to 75/25. If stocks drop another 15% from here, I will go to 80/20, then 85/15, etc. After a total collapse my investment portfolio will be 100% sto...

DrPayItBack

minimalistmarc wrote: ↑Sun Mar 01, 2020 9:02 am
SleepCity wrote: ↑Sun Mar 01, 2020 9:00 am I'm thinking of going all in on Apple in this market dip. The index funds are not going to bounce as high as apple will in the next 12 months. Anyone else try this method?
Sounds like a smart move, go for it

Be nice

DrPayItBack

Honestly though, what are you all trying to get me on at this point? I understand that RubyTuesday was just confused. I'm curious what you'd comment on this: No, they are NOT being anything of the sort. OP stated Tuesday, February 25, 2020, at 7:38 pm, well AFTER market close: https://www.boglehead...

DrPayItBack

You people have broken him and now he’s stuck in a loop.

DrPayItBack

A week after the market hits a new high he’ll post and say he got back in a month ago, obviously. I'll tell you my buy in event right now. The bogleheads who think this will all blow over, who think this is no worse than the flu , please raise your hands. I will buy back in when you change your min...

DrPayItBack

If the OP made his move on Tuesday at market close, the S&P closed at 3128, I believe. Since then it's down another 174 points, or 5.6%. He's avoided losing 5.6% of his total investment, and will come out ahead if he buys back in at any point below 3128. Sure, he made a risky, unboglehead move,...

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Here is a post he made Tuesday night. So at 7:38 pm he intends to keep buying because that’s when you really make money. But didn’t his post in this thread say he sold it all on Tuesday? by TomCat96 Tue Feb 25, 2020 7:38 pm Forum: Investing - Theory, News & General Topic: Isn’t this a fantastic...

DrPayItBack

-7.3%

60/20/10/10

US/ex-US/REIT/US bonds

DrPayItBack

A week after the market hits a new high he’ll post and say he got back in a month ago, obviously. If you read his posts, you'll see that he has been genuinely worried (to the point of obsession) about this for a long time. I think it was actually quite predictable that he would end up doing somethi...

DrPayItBack

A week after the market hits a new high he’ll post and say he got back in a month ago, obviously.

DrPayItBack

Let's be clear on how to splice this.. Bogleheads you are used to seeing it this way: 1. The market has gone down. I am so scared that I want to sell. I can't handle the drops. The above is the type of market timing you perceive. I am sorry but that is not what is happening here. This is how I perc...

DrPayItBack

TomCat96 wrote: ↑Sat Feb 29, 2020 3:35 pm I have the shared the conditions of when I will re-enter the market with a few on this site. I prefer not to share it here.

So what on earth is the point of this post? It’s clearly not for useful discussion.

DrPayItBack

Selling after a rapid decline is always the right answer.

DrPayItBack

I think the things that knocked me off balance were Bill Gates's article about this potentially being a once in a century pathogen, and a post about how the market might never recover. Every time there’s a selloff some smart person has a convincing reason why This Time It’s Different. It never is.

DrPayItBack

I love all these posts: “I’m not gonna time the market, I’m just gonna time it a little”.

DrPayItBack

My plan says to go to a more aggressive asset allocation if there is a substantial drop in equities. Last week I was at 68/32 or so. Yesterday I moved to 75/25. If stocks drop another 15% from here, I will go to 80/20, then 85/15, etc. After a total collapse my investment portfolio will be 100% sto...

DrPayItBack

My AA is 60% US equity, 20% ex-US equity, 10% REITs, 10% US bonds. My trigger is being off 5% absolute or 25% relative, which effectively means 2.5% absolute for the bonds and REITs to trigger a rebalance for the whole portfolio.

DrPayItBack

Now. No wait.....now.

DrPayItBack

You need to decide what asset allocation fits your risk tolerance and will prevent you from panic selling, and then lump sum into that ASAP.

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