Should I stay on course?

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Topic Author
wkimdds
Posts: 66
Joined: Thu Feb 27, 2020 10:46 am

Should I stay on course?

Post by wkimdds » Mon Mar 09, 2020 9:53 am

With market dropping, I'm scared :(:(:(

Should I stay on course or wait for market to drop a little more???

HEDGEFUNDIE
Posts: 4801
Joined: Sun Oct 22, 2017 2:06 pm

Re: Should I stay on course?

Post by HEDGEFUNDIE » Mon Mar 09, 2020 9:55 am

Move your bonds to EDV and you will have some insurance if the market keeps dropping.

You have bonds, right?

rockonhumblepie
Posts: 146
Joined: Fri Jan 04, 2013 1:51 pm

Re: Should I stay on course?

Post by rockonhumblepie » Mon Mar 09, 2020 10:10 am

Just relax,take a deep breath.

The Whiz kids here need more info to help.

I contributed to my 2019/2020 Roth today if that helps.





" It's only money,and money don't satisfy " - Robin Trower

pkcrafter
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Joined: Sun Mar 04, 2007 12:19 pm
Location: CA
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Re: Should I stay on course?

Post by pkcrafter » Mon Mar 09, 2020 10:49 am

wkimdds wrote:
Mon Mar 09, 2020 9:53 am
With market dropping, I'm scared :(:(:(

Should I stay on course or wait for market to drop a little more???
Hmm, on March 5th, you said this... "I agree but I don't think anyone is fearful."

Now you sound fearful. What happened?

I'm not sure what you mean by "should I stay or course or wait for the market to drop a little more". If you take option 2 (wait), what will you do if the market drops a little more?

Of course the answer is simply hang on, this too will pass.


Paul
When times are good, investors tend to forget about risk and focus on opportunity. When times are bad, investors tend to forget about opportunity and focus on risk.

chevca
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Joined: Wed Jul 26, 2017 11:22 am

Re: Should I stay on course?

Post by chevca » Mon Mar 09, 2020 10:58 am

What do you mean, wait for the market to drop a little more? If you're scared now, do you mean wait to see if you get more scared?

And basic answer, stay the course applies full time, not just when things are good.

tibbitts
Posts: 10739
Joined: Tue Feb 27, 2007 6:50 pm

Re: Should I stay on course?

Post by tibbitts » Mon Mar 09, 2020 11:00 am

wkimdds wrote:
Mon Mar 09, 2020 9:53 am
With market dropping, I'm scared :(:(:(

Should I stay on course or wait for market to drop a little more???
Wait to do what?

atdharris
Posts: 435
Joined: Wed Jan 02, 2019 3:18 pm

Re: Should I stay on course?

Post by atdharris » Mon Mar 09, 2020 11:01 am

HEDGEFUNDIE wrote:
Mon Mar 09, 2020 9:55 am
Move your bonds to EDV and you will have some insurance if the market keeps dropping.

You have bonds, right?
TLT certainly helped with the volatility in my portfolio over the last 2 weeks.

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watchnerd
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Joined: Sat Mar 03, 2007 11:18 am
Location: Seattle, WA, USA

Re: Should I stay on course?

Post by watchnerd » Mon Mar 09, 2020 11:07 am

atdharris wrote:
Mon Mar 09, 2020 11:01 am
HEDGEFUNDIE wrote:
Mon Mar 09, 2020 9:55 am
Move your bonds to EDV and you will have some insurance if the market keeps dropping.

You have bonds, right?
TLT certainly helped with the volatility in my portfolio over the last 2 weeks.
My long Treasuries (VGLT) are now looking at being +27% YTD.

I'm hitting rebalancing bands before Q1 is even over.
70% Global Market Weight Equities | 15% Long Treasuries 15% short TIPS & cash || RSU + ESPP

rich126
Posts: 1560
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Re: Should I stay on course?

Post by rich126 » Mon Mar 09, 2020 11:14 am

I'm not really a BH investor and certainly will not tell you what to do. In my case I have a decent amount of long term bonds (VGLT), some gold, and even bought some put options on the SPY on that big 1,000 pt bounce last week (I think) so that is helping my account (down < 2% today).

I will tell you what to avoid based on things I've done stupidly many decades ago. My typical response when I was younger was "Don't panic, things will recover." So I avoided getting out, at first! Then as things get worse and worse, I think, "hmm, maybe I should sell". Then eventually I do sell and (you can guess) my selling is close to the bottom and the hard part is getting back in and when you finally do, you realize you sold too late and bought in too late and ended up catching too much of the drop and missing too much of the gain. So that is why many here tell you to stay the course.

Of course staying the course varies depending where you are at in your age. If you are young and have tons of years left, don't look at it and just keep on plugging away. Down the road start adjusting AA based on your comfort level.

Now if you are approaching retirement and just realized your AA is too risky for you, the choice may be harder. If you were planning to have $1M and a 4% SWR and prior to this drop you had $1.2M and were thinking "wow, this is great" but now your portfolio is getting closer to the $1M level, I could see someone selling out and waiting until the virus scare calms down a bit. You may miss some bounces up but at least your preserved your retirement goal. Then when you get in, pick a more comfortable AA level. Not saying you should do this but I could understand someone doing so. I'm within 3 yrs of retirement and am pondering my options. I would be more concerned if I hadn't done some hedging.

Long term, and this isn't BH investing at all, I'm a huge believe of cutting back on stocks when things get too high for my comfort, and buying when things drop a lot. My goal isn't outsized gains but avoiding big losses. This time was one of the few times I didn't have a good 20% or more in cash although I guess that was offset by the fact I actually had bonds in my portfolio (anything from VGLT, moderate growth fund, Wellesley) and gold.

But for most people staying the course has worked in the past, and hopefully it will work again.

vipertom1970
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Joined: Fri Jun 21, 2019 7:06 pm

Re: Should I stay on course?

Post by vipertom1970 » Mon Mar 09, 2020 11:14 am

you will regret selling now, stay the course, just take a deep breath and read this "Here We Go" article..

viewtopic.php?f=10&t=305706

Topic Author
wkimdds
Posts: 66
Joined: Thu Feb 27, 2020 10:46 am

Re: Should I stay on course?

Post by wkimdds » Mon Mar 09, 2020 11:33 am

pkcrafter wrote:
Mon Mar 09, 2020 10:49 am
wkimdds wrote:
Mon Mar 09, 2020 9:53 am
With market dropping, I'm scared :(:(:(

Should I stay on course or wait for market to drop a little more???
Hmm, on March 5th, you said this... "I agree but I don't think anyone is fearful."

Now you sound fearful. What happened?

I'm not sure what you mean by "should I stay or course or wait for the market to drop a little more". If you take option 2 (wait), what will you do if the market drops a little more?

Of course the answer is simply hang on, this too will pass.


Paul
I was stupid to say that lol.

WhiteMaxima
Posts: 2143
Joined: Thu May 19, 2016 5:04 pm

Re: Should I stay on course?

Post by WhiteMaxima » Mon Mar 09, 2020 11:35 am

Stay alive, stay the course.

pkcrafter
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Joined: Sun Mar 04, 2007 12:19 pm
Location: CA
Contact:

Re: Should I stay on course?

Post by pkcrafter » Mon Mar 09, 2020 12:24 pm

wkimdds wrote:
Mon Mar 09, 2020 11:33 am
pkcrafter wrote:
Mon Mar 09, 2020 10:49 am
wkimdds wrote:
Mon Mar 09, 2020 9:53 am
With market dropping, I'm scared :(:(:(

Should I stay on course or wait for market to drop a little more???
Hmm, on March 5th, you said this... "I agree but I don't think anyone is fearful."

Now you sound fearful. What happened?

I'm not sure what you mean by "should I stay or course or wait for the market to drop a little more". If you take option 2 (wait), what will you do if the market drops a little more?

Of course the answer is simply hang on, this too will pass.


Paul
I was stupid to say that lol.
No, not stupid--you did not sell!

The recent experience is what reeealy scares investors. They were bracing for the Coronavirus, but then were double whammed by the Saudi price-war with Russia. The unexpected (surprise and chaos) is what moves investors to panic mode.

Investors can hold through severe declines as long as they understand what's going on and have included such declines in their plan. When something happens that is beyond their scope of expectation they often will panic and get out.



Paul
When times are good, investors tend to forget about risk and focus on opportunity. When times are bad, investors tend to forget about opportunity and focus on risk.

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