Sperry, can we assume you are now out of the market? Following your advice, you would have gotten out of the market in ~1995 and stayed out until 2009.
I think Sbashore is right, we are now getting off topic, so I'll wait for Slipp to return.
Where in my comment to read that? I did not say my advice was to sell stocks now. What I said was that I am not a new
buyer of stocks at these prices. And I wouldn't recommend to the OP, who clearly was scared enough during the last recession and dumped it all - to make his first
purchase at these prices. I think he should wait until the Shiller PE10 comes down before he starts to DCA in. I also said to start buying in at Shiller PE10 18. Which means he would've started to buy in around late 2008 - and gotten all in by Spring 2009.
Sbashore wrote:In my opinion this kind of advice is not helpful to the OP. You may be right, you may be wrong, but whatever you are it will be the result of chance. In real terms the market is not at an all time high. The reality is that no one knows, what is to come. What I do think is that the OP should not be in a hurry to jump into anything until he understands the ramifications of his actions. For someone who has been out of the market for this amount of time, jumping to giving advice on "market timing" is not good advice. I'm not going to say more in this thread since I think it flirts with hijacking the original post and would just further obfuscate the issue for the OP.
I agree with you. The OP should not be in a hurry to jump in. And I didn't offer any such advice to do so. I agree he currently does not have a handle on his risk tolerance and must figure that out before he gets back into the market. However, I disagree on this point; We do know what is to come. The market will be higher than it is now. And it will be lower. Both will occur. What we don't know is when. But it will be higher and it will be lower. Better to wait til it's lower before buying (and yes, as you say, he must get a handle on the "ramifications of his actions" before he does. Which to me means, get a handle on his risk tolerance and his perspective so that whenever he does buy back in, he will not jump out at the first sign of "lower".
I love bogleheads. You've taught me a lot. You helped keep me in the market through the 08/09 years. It was very hard to do. Without your help and a few others, I might have sold and been very unhappy today. I even bought some stocks near the lows. Not a lot, but some. And it was in no small part to all the wonderful advice I received on this forum. However, I think some Bogleheads do a disservice to newbies when they say "we have no idea what stocks will do", therefore just buy in whenever. For someone who sold out at the bottom, only to buy in after it's up 5 years later without any significant correction is a disservice. This is exactly market timing on the opposite scale! He sold low. And based on their advice, he should just buy now (high) because we don't know where the market is going. I think that sort of advice is unhelpful to the OP and others who seek advice here.
Certainty is a requirement of ignorance. | Humbling Boglehead Contest finishes: | 2014: #225 of 503 - 2013: #383 of 433 - 2012: #366 of 410 - 2011: #113 of 369 - 2010: #53 of 282