Elephant in the Room: What Index Funds When the Market Surges

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Topic Author
pocketplayer
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Elephant in the Room: What Index Funds When the Market Surges

Post by pocketplayer »

For those over 50, we have been through this before...I am NOT a market timer!
But...because of family issues I pulled out into Money Market Fund and then got
an inheritance (father passed), so I have about $90k out of market--money market
and checking just sitting. Like most, I never saw this coming so I was already in
cash before this all started.

This will end and there will be a time to enter the market again...I have followed
a 3-4 fund portfolio based on this community and like this wisdom. When it is
time to re-enter...are there say 3 funds to stick with? If so, what are you doing?

I am tempted to pursue specific sectors that rise in these times...anything related
to health care and the second amendment, but I am out of my realm and stick with
index funds...so I will stay that course.
Last edited by pocketplayer on Fri Mar 13, 2020 5:53 am, edited 1 time in total.
ukbogler
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Re: Elephant in the Room: What Index Funds When the Market Surges

Post by ukbogler »

pork bellies
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watchnerd
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Re: Elephant in the Room: What Index Funds When the Market Surges

Post by watchnerd »

Perhaps I'm dumb.

If you've 3-4 fund portfolio before, why not do so again, using the same funds?
70% Global Market Weight Equities | 15% Long Treasuries 15% short TIPS & cash || RSU + ESPP
Topic Author
pocketplayer
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Re: Elephant in the Room: What Index Funds When the Market Surges

Post by pocketplayer »

I have been out of the market for some years now...so getting feedback from
those here daily is supportive. Many new funds have emerged...like pork bellies :annoyed
Just seeking perspective...this is a game on feeling assurance yes?
Also, this is a very unique period of time...what specific index funds others feel strongly
about is something I want to consider. I hope to get other perspectives I am not aware of.
Thanks...
Dottie57
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Re: Elephant in the Room: What Index Funds When the Market Surges

Post by Dottie57 »

Every time is unique.

I would buy into the three or four fund portfolio. For me nothing has changed my investing philosophy. I want to buy the whole market. New funds come and go. I want low cost with a wide spread of assets.
BoggledHead2
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Re: Elephant in the Room: What Index Funds When the Market Surges

Post by BoggledHead2 »

Total International Index
Total US Index
SP500 Index
Total World Index

Pick 1 or 2 and stop making this more complicated than it needs to.

Early trading suggests a huge rally today after yesterday’s absurdity
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Re: Elephant in the Room: What Index Funds When the Market Surges

Post by BoggledHead2 »

Dottie57 wrote: Fri Mar 13, 2020 7:33 am Every time is unique.

I would buy into the three or four fund portfolio. For me nothing has changed my investing philosophy. I want to buy the whole market. New funds come and go. I want low cost with a wide spread of assets.
This
pkcrafter
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Re: Elephant in the Room: What Index Funds When the Market Surges

Post by pkcrafter »

pocketplayer wrote: Fri Mar 13, 2020 5:24 am For those over 50, we have been through this before...I am NOT a market timer!
But...because of family issues I pulled out into Money Market Fund and then got
an inheritance (father passed), so I have about $90k out of market--money market
and checking just sitting. Like most, I never saw this coming so I was already in
cash before this all started.

So, right now you have nothing in stocks, or are you just talking about the 90k?

This will end and there will be a time to enter the market again...I have followed
a 3-4 fund portfolio based on this community and like this wisdom. When it is
time to re-enter...are there say 3 funds to stick with?

I would reenter now using the classic 3-fund portfolio. What is you target asset allocation?

viewtopic.php?f=10&t=88005

I am tempted to pursue specific sectors that rise in these times...anything related
to health care and the second amendment, but I am out of my realm and stick with
index funds...so I will stay that course.

That's it!

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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Nate79
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Re: Elephant in the Room: What Index Funds When the Market Surges

Post by Nate79 »

pocketplayer wrote: Fri Mar 13, 2020 5:24 am For those over 50, we have been through this before...I am NOT a market timer!
But...because of family issues I pulled out into Money Market Fund and then got
an inheritance (father passed), so I have about $90k out of market--money market
and checking just sitting. Like most, I never saw this coming so I was already in
cash before this all started.

This will end and there will be a time to enter the market again...I have followed
a 3-4 fund portfolio based on this community and like this wisdom. When it is
time to re-enter...are there say 3 funds to stick with? If so, what are you doing?

I am tempted to pursue specific sectors that rise in these times...anything related
to health care and the second amendment, but I am out of my realm and stick with
index funds...so I will stay that course.
For not being a market timer, you sure do want to market time.
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Sandtrap
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Re: Elephant in the Room: What Index Funds When the Market Surges

Post by Sandtrap »

Dottie57 wrote: Fri Mar 13, 2020 7:33 am Every time is unique.

I would buy into the three or four fund portfolio. For me nothing has changed my investing philosophy. I want to buy the whole market. New funds come and go. I want low cost with a wide spread of assets.
+1
OP: sometimes things are so simple, but human nature needs it to be complex.
Continue to invest as you had before.

The only elephants in the room are our own fears. :confused
j :happy
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amp
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Re: Elephant in the Room: What Index Funds When the Market Surges

Post by amp »

Here's the Bogleheads wiki page for the 3-fund portfolio: https://www.bogleheads.org/wiki/Three-fund_portfolio

Section 1.3 lists out a number of options to choose from depending on your broker and if you prefer to hold mutual funds or ETFs.
Topic Author
pocketplayer
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Re: Elephant in the Room: What Index Funds When the Market Surges

Post by pocketplayer »

Thanks...some interesting emotional responses here.
I clearly said I am in CASH right now, so if the market
radically drops (this IS unique)...how one can say a drop
from 29k to 20k in a month is not unique is beyond me.

I get the Boglehead philosophy, but let's not get religious
about this. If you have $90k in cash, and the market
dropped like it has, isn't this a very good time to re-enter?

If so, with what? That is all I was asking...and because it has
been years, I wondered if there were better index funds
but it seems the same "total" funds still are the route to take.

I think some here for a long time get comfortable with the
philosophy and can talk down to those simply seeking advice.
If you believe in a particular "gospel" of investing, then share it
with a positive vibe...note the first response I received...pork bellies.
Now that was a nice introduction...
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David Jay
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Re: Elephant in the Room: What Index Funds When the Market Surges

Post by David Jay »

Total market is the way to go. Great diversification, essentially no cost, no idiosyncratic risk.

(Should have placed the order a half hour ago, the market is ending the week with an UP day of 9% or so)
Last edited by David Jay on Fri Mar 13, 2020 3:02 pm, edited 2 times in total.
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bryanm
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Re: Elephant in the Room: What Index Funds When the Market Surges

Post by bryanm »

The problem with fund selection is essentially the same as market timing. If you pick funds that you expect to do well in times like these, you must expect that everyone else has also picked and invested in those funds, and that the current price reflects those expectations. You might know better than the crowd, or you might not. Same as timing the market. I'm staying with total market, myself.
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grabiner
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Re: Elephant in the Room: What Index Funds When the Market Surges

Post by grabiner »

pocketplayer wrote: Fri Mar 13, 2020 2:48 pm I get the Boglehead philosophy, but let's not get religious
about this. If you have $90k in cash, and the market
dropped like it has, isn't this a very good time to re-enter?
What your investment is in now is irrelevant. If you are out of the stock market today and go all in tomorrow, and I am already all in, we will have the same returns in the future, so the right strategy for me is the same as for you.

What is relevant is your risk tolerance. If your risk tolerance is inconsistent with 100% stock (because you will either pull out or have difficulty sleeping, or because you are too close to retirement), you shouldn't be in 100% stock in today's market, and you also shouldn't be in 100% stock in a calm market. My own risk tolerance is inconsistent with 100% stock because I am too close to retirement, but I just rebalanced to my normal 88% stock yesterday.
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Re: Elephant in the Room: What Index Funds When the Market Surges

Post by MoneyMarathon »

pocketplayer wrote: Fri Mar 13, 2020 2:48 pm If you believe in a particular "gospel" of investing, then share it
with a positive vibe...note the first response I received...pork bellies.
Now that was a nice introduction...
That poster is predicting a Great Depression scenario in their other posts. (It's an odd way to express it, for sure.)

The simplest way to outperform the US stock market, if you know it is going up (somehow), is leverage. PPLC (135% the S&P 500) is an example. Both the downward and upward movements are amplified.
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Re: Elephant in the Room: What Index Funds When the Market Surges

Post by MotoTrojan »

The right answer to the question being provided is UPRO, which tracks on a daily basis 3x the return of the S&P500. Only problem is determining when the market is going to surge first.
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Re: Elephant in the Room: What Index Funds When the Market Surges

Post by z3r0c00l »

If I had it all to buy over again, I would just get a total world index fund. As it is, I have a three fund system in place and taxes prevent me from consolidating into one fund.
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