Market Timing Change
Market Timing Change
Good Afternoon everyone,
I saw an article on Yahoo about taking profits in anticipation of a 10% correction in the near future. I feel so foolish that I acted on such an article. I took about 10% of my equity allocation out of the market. Settlement day is tomorrow. It's in cash. What are my best options? I hesitate to buy back in at a price higher that what I sold for and would wait for that price to return. There are several articles claiming imminent downtown. The Fed says economy is strong. I'm ashamed of this market timing mistake. Having been browsing the forum for nearly 10 years, I should know better. My IPS say's rebalance when my equity/bond allocation is out by about 5% or so. It was not. In fact it was very close to my target of 50/50 Stock/Bond. I did not follow my IPS. Now I'm at 44/56 stock/bond allocation. I apologize for creating another such thread. I've been using the search box and have ready many threads by others who have done the same thing. Thanks much.
I saw an article on Yahoo about taking profits in anticipation of a 10% correction in the near future. I feel so foolish that I acted on such an article. I took about 10% of my equity allocation out of the market. Settlement day is tomorrow. It's in cash. What are my best options? I hesitate to buy back in at a price higher that what I sold for and would wait for that price to return. There are several articles claiming imminent downtown. The Fed says economy is strong. I'm ashamed of this market timing mistake. Having been browsing the forum for nearly 10 years, I should know better. My IPS say's rebalance when my equity/bond allocation is out by about 5% or so. It was not. In fact it was very close to my target of 50/50 Stock/Bond. I did not follow my IPS. Now I'm at 44/56 stock/bond allocation. I apologize for creating another such thread. I've been using the search box and have ready many threads by others who have done the same thing. Thanks much.
Re: Market Timing Change
Buy something that has actually dropped a little bit since you sold. Easy.
Re: Market Timing Change
peddler12,
Do nothing for the next few days/weeks. Reexamine your asset allocation (AA). If you can easily be influenced by an article in yahoo to sell 10% of your portfolio,
A) You are not confident about your AA
B) Perhaps, you should not use 3 funds portfolio. Move into a one fund of funds solution.
C) Do nothing until you gain confidence about your AA. If not, you will sell again.
D) Or, your emergency fund is too small.
KlangFool
30% VWENX | 16% VFWAX/VTIAX | 14.5% VTSAX | 19.5% VBTLX | 10% VSIAX/VTMSX/VSMAX | 10% VSIGX| 30% Wellington 50% 3-funds 20% Mini-Larry
Re: Market Timing Change
Who knows, maybe what you did will turn out for the best. In any event, stick to your plan for now on because any actions on your part should reflect maintaining your pre-set tolerance for risk - not anticipating market swings. We all backslide from time to time, learn the lesson.
"Plans are useless; planning is indispensable.” (Dwight Eisenhower) |
"Man plans, God laughs" (Yiddish proverb)
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Re: Market Timing Change
You didn't move 100% to cash. My guess, just a guess, probably not that big a deal in the big picture, over many years. It's just 10%. I would not beat yourself up over this, just move on with what makes sense for you.
Re: Market Timing Change
You don't know if it was a mistake yet. You know you weren't going to get timing exactly right to the day - although a number of Bogleheads have claimed to have done that in the past, such as getting out at the beginning of the financial crisis, and then getting entirely back in on the very lowest day. The challenge now is to figure out how to make the most of your new funds in terms of fixed income.peddler12 wrote: ↑Thu Apr 15, 2021 3:02 pm Good Afternoon everyone,
I saw an article on Yahoo about taking profits in anticipation of a 10% correction in the near future. I feel so foolish that I acted on such an article. I took about 10% of my equity allocation out of the market. Settlement day is tomorrow. It's in cash. What are my best options? I hesitate to buy back in at a price higher that what I sold for and would wait for that price to return. There are several articles claiming imminent downtown. The Fed says economy is strong. I'm ashamed of this market timing mistake. Having been browsing the forum for nearly 10 years, I should know better. My IPS say's rebalance when my equity/bond allocation is out by about 5% or so. It was not. In fact it was very close to my target of 50/50 Stock/Bond. I did not follow my IPS. Now I'm at 44/56 stock/bond allocation. I apologize for creating another such thread. I've been using the search box and have ready many threads by others who have done the same thing. Thanks much.
Re: Market Timing Change
peddler12 wrote: ↑Thu Apr 15, 2021 3:02 pm Good Afternoon everyone,
I saw an article on Yahoo about taking profits in anticipation of a 10% correction in the near future. I feel so foolish that I acted on such an article. I took about 10% of my equity allocation out of the market. Settlement day is tomorrow. It's in cash. What are my best options? I hesitate to buy back in at a price higher that what I sold for and would wait for that price to return. There are several articles claiming imminent downtown. The Fed says economy is strong. I'm ashamed of this market timing mistake. Having been browsing the forum for nearly 10 years, I should know better. My IPS say's rebalance when my equity/bond allocation is out by about 5% or so. It was not. In fact it was very close to my target of 50/50 Stock/Bond. I did not follow my IPS. Now I'm at 44/56 stock/bond allocation. I apologize for creating another such thread. I've been using the search box and have ready many threads by others who have done the same thing. Thanks much.
You haven’t learned your lesson yet. Wash. Rinse. Repeat.
Re: Market Timing Change
There will be a downturn--over and over and over again. You are about 60yo, but I don't know how much longer you plan to work or what your total assets are, but I will suggest you simply leave your AA at 45/55 if it will provide what you need going into retirement. I'll also mention that when you retire and no longer have that regular income, you might suddenly feel very vulnerable and uncomfortable, but it quickly goes away--stay on course.peddler12 wrote: ↑Thu Apr 15, 2021 3:02 pm Good Afternoon everyone,
I saw an article on Yahoo about taking profits in anticipation of a 10% correction in the near future. I feel so foolish that I acted on such an article. I took about 10% of my equity allocation out of the market. Settlement day is tomorrow. It's in cash. What are my best options? I hesitate to buy back in at a price higher that what I sold for and would wait for that price to return. There are several articles claiming imminent downtown.
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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Re: Market Timing Change
if the stock market was due for a 10% decline and you have 50% in stocks, then that would be a 5% total decline.
if that's a concern to you, then you shouldn't be 50/50.
maybe you'd think 5%, huh? well that's nothing.
but then you have to look at 5% of what? your overall portfolio.
if you have $1 million and lose 5% that's a $50,000 loss.
if that's a concern to you then you should look at your allocation.
also remember that if you lose 5%, you have 95% left still.
also if you had a $1 million and lost $50k, you still have $950,000.
run the numbers.
feel the emotions.
predict what you're likely to do if the market declines (before it declines).
re-run the experiment with different percentage stock market losses:
20% stock decline (would lead to 10% overall decline on 50/50)
30% stock decline (would lead to 15% overall decline on 50/50)
40% stock decline (would lead to 20% overall decline on 50/50)
50% stock decline (would lead to 25% overall decline on 50/50)
re run the experiment with 40/60 (take the percentage loss on stocks and multiply by 40% instead of 50%).
determine your risk tolerance.
most people think their risk tolerance is higher than it really is. They take more risk when stocks are up and sell in a panic when stocks are down (or fear they'll fall).
market's fall each year. so what:
also, stop listening to experts. here's why:
if that's a concern to you, then you shouldn't be 50/50.
maybe you'd think 5%, huh? well that's nothing.
but then you have to look at 5% of what? your overall portfolio.
if you have $1 million and lose 5% that's a $50,000 loss.
if that's a concern to you then you should look at your allocation.
also remember that if you lose 5%, you have 95% left still.
also if you had a $1 million and lost $50k, you still have $950,000.
run the numbers.
feel the emotions.
predict what you're likely to do if the market declines (before it declines).
re-run the experiment with different percentage stock market losses:
20% stock decline (would lead to 10% overall decline on 50/50)
30% stock decline (would lead to 15% overall decline on 50/50)
40% stock decline (would lead to 20% overall decline on 50/50)
50% stock decline (would lead to 25% overall decline on 50/50)
re run the experiment with 40/60 (take the percentage loss on stocks and multiply by 40% instead of 50%).
determine your risk tolerance.
most people think their risk tolerance is higher than it really is. They take more risk when stocks are up and sell in a panic when stocks are down (or fear they'll fall).
market's fall each year. so what:
also, stop listening to experts. here's why:
It's hard to accept the truth when the lies were exactly what you wanted to hear. Investing is simple, but not easy. Buy, hold & rebalance low cost index funds & manage taxable events. Asking Portfolio Questions |
Re: Market Timing Change
So you bought back almost everything you sold, right?
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Re: Market Timing Change
Great post. Thank you Arctic!
Re: Market Timing Change
livesoft I did not buy back what I sold, but I did take the cash from the sale and bought a stock that was out of favor this year. The stock was down a little over 5% for the year as of yesterday. I won't say what I purchased. I have two reports set up in Quicken. My stock and VTI as the benchmark. I will watch. The stock yields over 3%, and is currently well below fair market value. Years ago I owned this stock, so it was already in Quicken. Years ago there was an event that caused the stock to decline substantially. Because of this, I'm acquainted with the the risks of owning it. The value of this equity is 1.96% of my portfolio, and it is the only single stock I've purchased or will purchase. With all that said, that is how I handled my mistake. Forgive me for not listening to the other poster who said not to do anything for a few days or a couple of weeks. With this purchase, my AA is about 51%Stock/49%Bonds. I'm back to being about 50/50. I know that in the 2000-2002 decline my expected loss is about 14%. My sleep well at night can handle the $100,000.00 decline in my portfolio. livesoft I was thrilled when you responded to my thread. I also want to thank all the others that gave input into my mistake. I'll try not to pay attention to the financial porn again. BTW, I have an account with Morningstar which is how I located the equity that I bought. Thank you to everyone. I am grateful to have found Bogleheads all those years ago.
Re: Market Timing Change
I assume the article was just part of the motivation - that final .1% that tipped the OP over the edge. And it could still work out for the best, you never know.TropikThunder wrote: ↑Fri Apr 16, 2021 4:00 pmSelling because of an article on Yahoo Finance (Yahoo?! Seriously?!) was a mistake regardless of how it turns out. Even reading the article in the first place was probably a mistake ....
Re: Market Timing Change
I'm not sure anybody was seriously suggesting you buy an individual equity vs. a larger segment of the market that has (relatively) underperformed recently.peddler12 wrote: ↑Fri Apr 16, 2021 5:07 pmlivesoft I did not buy back what I sold, but I did take the cash from the sale and bought a stock that was out of favor this year. The stock was down a little over 5% for the year as of yesterday. I won't say what I purchased. I have two reports set up in Quicken. My stock and VTI as the benchmark. I will watch. The stock yields over 3%, and is currently well below fair market value. Years ago I owned this stock, so it was already in Quicken. Years ago there was an event that caused the stock to decline substantially. Because of this, I'm acquainted with the the risks of owning it. The value of this equity is 1.96% of my portfolio, and it is the only single stock I've purchased or will purchase. With all that said, that is how I handled my mistake. Forgive me for not listening to the other poster who said not to do anything for a few days or a couple of weeks. With this purchase, my AA is about 51%Stock/49%Bonds. I'm back to being about 50/50. I know that in the 2000-2002 decline my expected loss is about 14%. My sleep well at night can handle the $100,000.00 decline in my portfolio. livesoft I was thrilled when you responded to my thread. I also want to thank all the others that gave input into my mistake. I'll try not to pay attention to the financial porn again. BTW, I have an account with Morningstar which is how I located the equity that I bought. Thank you to everyone. I am grateful to have found Bogleheads all those years ago.
Re: Market Timing Change
You are correct. There was no one suggesting I take this path. That was my decision. I am hoping all turns out well. We will see. I'll probably know within the year. I'll come back to this thread when I sell the equity. Thank you.tibbitts wrote: ↑Fri Apr 16, 2021 5:10 pmI'm not sure anybody was seriously suggesting you buy an individual equity vs. a larger segment of the market that has (relatively) underperformed recently.peddler12 wrote: ↑Fri Apr 16, 2021 5:07 pmlivesoft I did not buy back what I sold, but I did take the cash from the sale and bought a stock that was out of favor this year. The stock was down a little over 5% for the year as of yesterday. I won't say what I purchased. I have two reports set up in Quicken. My stock and VTI as the benchmark. I will watch. The stock yields over 3%, and is currently well below fair market value. Years ago I owned this stock, so it was already in Quicken. Years ago there was an event that caused the stock to decline substantially. Because of this, I'm acquainted with the the risks of owning it. The value of this equity is 1.96% of my portfolio, and it is the only single stock I've purchased or will purchase. With all that said, that is how I handled my mistake. Forgive me for not listening to the other poster who said not to do anything for a few days or a couple of weeks. With this purchase, my AA is about 51%Stock/49%Bonds. I'm back to being about 50/50. I know that in the 2000-2002 decline my expected loss is about 14%. My sleep well at night can handle the $100,000.00 decline in my portfolio. livesoft I was thrilled when you responded to my thread. I also want to thank all the others that gave input into my mistake. I'll try not to pay attention to the financial porn again. BTW, I have an account with Morningstar which is how I located the equity that I bought. Thank you to everyone. I am grateful to have found Bogleheads all those years ago.
Re: Market Timing Change
Chalk it up to a lesson learned the hard way.
Re: Market Timing Change
If it were me I would also buy something right away. It’s my personality or should I say quirk that I hate sitting on dry powder, it must be deployed or I cannot rest. Maybe I’d feel differently in a falling market but that’s not what we have right now.
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Re: Market Timing Change
This seems like an odd outcome for a story that started with the intention of reducing risk related to a downturn, since the OP has now actually increased his risk and not avoided the downturn he feared.
Maybe befuddled is the word I'm looking for.
Regards,
Maybe befuddled is the word I'm looking for.
Regards,
If liberty means anything at all it means the right to tell people what they do not want to hear. -George Orwell
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Re: Market Timing Change
Not the worst mistake I heard. You only moved 10% out of the market. Some people moved 100% out after the market crashed in March 2020 and are still waiting for a good time to get back in.peddler12 wrote: ↑Thu Apr 15, 2021 3:02 pm Good Afternoon everyone,
I saw an article on Yahoo about taking profits in anticipation of a 10% correction in the near future. I feel so foolish that I acted on such an article. I took about 10% of my equity allocation out of the market. Settlement day is tomorrow. It's in cash. What are my best options? I hesitate to buy back in at a price higher that what I sold for and would wait for that price to return. There are several articles claiming imminent downtown. The Fed says economy is strong. I'm ashamed of this market timing mistake. Having been browsing the forum for nearly 10 years, I should know better. My IPS say's rebalance when my equity/bond allocation is out by about 5% or so. It was not. In fact it was very close to my target of 50/50 Stock/Bond. I did not follow my IPS. Now I'm at 44/56 stock/bond allocation. I apologize for creating another such thread. I've been using the search box and have ready many threads by others who have done the same thing. Thanks much.
TravelforFun
Re: Market Timing Change
Going from a rash decision to move 10% of your equities to cash based on an article from Yahoo and then immediately regretting it and buying an individual stock with that 10% within a couple of days is a bit of a head-scratcher. I think you would do well to heed Klangfool's advice.
The fool, with all his other faults, has this also - he is always getting ready to live. - Seneca Epistles < c. 65AD
- Taylor Larimore
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Market Timing
peddler12:peddler12 wrote: ↑Thu Apr 15, 2021 3:02 pm Good Afternoon everyone,
I saw an article on Yahoo about taking profits in anticipation of a 10% correction in the near future. I feel so foolish that I acted on such an article. I took about 10% of my equity allocation out of the market. Settlement day is tomorrow. It's in cash. What are my best options? I hesitate to buy back in at a price higher that what I sold for and would wait for that price to return. There are several articles claiming imminent downtown. The Fed says economy is strong. I'm ashamed of this market timing mistake. Having been browsing the forum for nearly 10 years, I should know better. My IPS say's rebalance when my equity/bond allocation is out by about 5% or so. It was not. In fact it was very close to my target of 50/50 Stock/Bond. I did not follow my IPS. Now I'm at 44/56 stock/bond allocation. I apologize for creating another such thread. I've been using the search box and have ready many threads by others who have done the same thing. Thanks much.
Thank you for sharing your disappointing experience with market timing. It takes guts and self-confidence to admit you made a mistake. Read what experts say:
What Experts Say About Market Timing
Best wishes.
Taylor
"After nearly 50 years in this business, I do not know of anybody who has done market timing successfully and consistently. I don't even know anybody who knows anybody who has done it successfully and consistently."
"Simplicity is the master key to financial success." -- Jack Bogle
Re: Market Timing Change
No need to feel bad or apologize. If it's not market timing, it's some other investing mistake most or all of us (being human) manage to make. What's important is that you use a mistake to understand why you made it and learn the right lessons from it. For example, did you look at your IPS before you timed? If not, looking at it before you make any new moves should be written into it, including your recent timing and why you timed. Do you know what it was in these articles that not only tempted you but tempted you enough to time? Note that forecasts are general outlooks and expectations, not certainties, and are often wrong.peddler12 wrote: ↑Thu Apr 15, 2021 3:02 pm ...
There are several articles claiming imminent downtown. The Fed says economy is strong. I'm ashamed of this market timing mistake. Having been browsing the forum for nearly 10 years, I should know better. ... I apologize for creating another such thread. I've been using the search box and have ready many threads by others who have done the same thing. Thanks much.
We've all seen market timing regrets on the forum, but they often are more about timing being a problem of when to get back in, rather what caused one to get out in the first place.
"Yes, investing is simple. But it is not easy, for it requires discipline, patience, steadfastness, and that most uncommon of all gifts, common sense." ~Jack Bogle
Re: Market Timing Change
There's no need for shame. It's your money.
You do. So maybe it wasn't a mistake. You probably have a reason besides "I read an article". That was just the final little prod.Having been browsing the forum for nearly 10 years, I should know better.
You just revealed your actual risk tolerance to yourself. Revise your IPS.My IPS say's rebalance when my equity/bond allocation is out by about 5% or so. It was not. In fact it was very close to my target of 50/50 Stock/Bond. I did not follow my IPS.
Me too pretty much. You only went by 5-6%. That's not even market timing.Now I'm at 44/56 stock/bond allocation.
The only problem I see with what you did is that it sounds you did not have a place in mind for where you were going to put what you took out of equities. Half of a plan. Unless cash was the plan. It doesn't sound like it was, but maybe it was. So what? It's your money.
If you don't want to put it back into equities, you can just wait for your AA to drift back to 50/50. And maybe you'll find yourself rebalancing back to where you are now... Then you'll know.
"The only thing that makes life possible is permanent, intolerable uncertainty; not knowing what comes next." ~Ursula LeGuin
Re: Market Timing Change
Hello all,
I need to say this. I did not sell out of the market because I was fearful. I thought the article sounded like good advice for preservation of assets, but as I've learned, more money is lost trying to prevent losses than what the losses would have been themselves should they have occured. As an additional note about my being fearful, I did two IFTs back in March of 2020 to buy the C Fund. My risk tolerance is appropriate for my sleep well at night. Fallible thank you for the wonderful post. I truly enjoyed reading it. Thank you. My birthday was Wednesday. I turned 60. If my health does not deteriorate, I plan to retire at the end of 2027. Probably before I retire, I'll rebalance from my current 50/50 AA to PKCrafter's 40/60 AA. I don't remember who said it, but when I retire I may be uncomfortable for a time, but you do get over it. That was sound advice. Learning to live without a paycheck will certainly be something I will have to learn to do. Thanks all.
I need to say this. I did not sell out of the market because I was fearful. I thought the article sounded like good advice for preservation of assets, but as I've learned, more money is lost trying to prevent losses than what the losses would have been themselves should they have occured. As an additional note about my being fearful, I did two IFTs back in March of 2020 to buy the C Fund. My risk tolerance is appropriate for my sleep well at night. Fallible thank you for the wonderful post. I truly enjoyed reading it. Thank you. My birthday was Wednesday. I turned 60. If my health does not deteriorate, I plan to retire at the end of 2027. Probably before I retire, I'll rebalance from my current 50/50 AA to PKCrafter's 40/60 AA. I don't remember who said it, but when I retire I may be uncomfortable for a time, but you do get over it. That was sound advice. Learning to live without a paycheck will certainly be something I will have to learn to do. Thanks all.
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Re: Market Timing Change
This is not the one I read the headline, but is as good as any.UpperNwGuy wrote: ↑Fri Apr 16, 2021 7:31 pmCan you post a link to the article? I'm always eager to learn how people are able to predict the future.
https://www.yahoo.com/finance/video/inv ... 59932.html
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Re: Market Timing Change
I will say that while it was a breach not to follow your IPS, I wouldn't beat yourself up too much about it. It probably won't make a huge difference in the long run. It is much less of a mistake to try to preserve 10% profit after massive bull market run than it is to sell out of fear after a huge market drop.
Re: Market Timing Change
The problem is that there are always articles like this. Even in a bear market there are articles saying it’s not too late to sell so sell now before it goes still lower. Sometimes they’re right but how can you believe them?peddler12 wrote: ↑Fri Apr 16, 2021 7:39 pm This is not the one I read the headline, but is as good as any.
https://www.yahoo.com/finance/video/inv ... 59932.html
Re: Market Timing Change
+1retired@50 wrote: ↑Fri Apr 16, 2021 5:18 pm This seems like an odd outcome for a story that started with the intention of reducing risk related to a downturn, since the OP has now actually increased his risk and not avoided the downturn he feared.
Maybe befuddled is the word I'm looking for.
Regards,
Peddler, I don't think being a part-time Boglehead is going to work.
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.
Re: Market Timing Change
Oh.
Okay.The stock yields over 3%, and is currently well below fair market value. Years ago I owned this stock, so it was already in Quicken. Years ago there was an event that caused the stock to decline substantially. Because of this, I'm acquainted with the the risks of owning it.
What? How did you sell some equities and end up at 44/56 and then take what you sold and buy a stock that is now ~2% of your portfolio and you're now at 51/49? What on earth are you holding that went up that much that fast?The value of this equity is 1.96% of my portfolio, and it is the only single stock I've purchased or will purchase. With all that said, that is how I handled my mistake. Forgive me for not listening to the other poster who said not to do anything for a few days or a couple of weeks. With this purchase, my AA is about 51%Stock/49%Bonds.
"The only thing that makes life possible is permanent, intolerable uncertainty; not knowing what comes next." ~Ursula LeGuin
Re: Market Timing Change
I've enjoyed your posts Beensabu. Thank you. Let me explain. 44/56 is only my ROTH AA. The 2% of portfolio includes my TSP balance. This stock is actually 5.37% of my ROTH balance. Good catch.Beensabu wrote: ↑Fri Apr 16, 2021 8:53 pmOh.
Okay.The stock yields over 3%, and is currently well below fair market value. Years ago I owned this stock, so it was already in Quicken. Years ago there was an event that caused the stock to decline substantially. Because of this, I'm acquainted with the the risks of owning it.
What? How did you sell some equities and end up at 44/56 and then take what you sold and buy a stock that is now ~2% of your portfolio and you're now at 51/49? What on earth are you holding that went up that much that fast?The value of this equity is 1.96% of my portfolio, and it is the only single stock I've purchased or will purchase. With all that said, that is how I handled my mistake. Forgive me for not listening to the other poster who said not to do anything for a few days or a couple of weeks. With this purchase, my AA is about 51%Stock/49%Bonds.
Re: Market Timing Change
Nice job livesoft. Your incomplete vague answer got him to buy a single stock. You might want to recognize that people asking questions here probably aren't as set as you, so your responses matter. Please be more careful.peddler12 wrote: ↑Fri Apr 16, 2021 5:07 pmlivesoft I did not buy back what I sold, but I did take the cash from the sale and bought a stock that was out of favor this year. The stock was down a little over 5% for the year as of yesterday. I won't say what I purchased. I have two reports set up in Quicken. My stock and VTI as the benchmark. I will watch. The stock yields over 3%, and is currently well below fair market value. Years ago I owned this stock, so it was already in Quicken. Years ago there was an event that caused the stock to decline substantially. Because of this, I'm acquainted with the the risks of owning it. The value of this equity is 1.96% of my portfolio, and it is the only single stock I've purchased or will purchase. With all that said, that is how I handled my mistake. Forgive me for not listening to the other poster who said not to do anything for a few days or a couple of weeks. With this purchase, my AA is about 51%Stock/49%Bonds. I'm back to being about 50/50. I know that in the 2000-2002 decline my expected loss is about 14%. My sleep well at night can handle the $100,000.00 decline in my portfolio. livesoft I was thrilled when you responded to my thread. I also want to thank all the others that gave input into my mistake. I'll try not to pay attention to the financial porn again. BTW, I have an account with Morningstar which is how I located the equity that I bought. Thank you to everyone. I am grateful to have found Bogleheads all those years ago.
Peddler, it's only 2% of your portfolio, but you didn't really have to only buy something that was down recently. You could have just stayed with your new more conservative allocation or bought back into the total market index. Don't beat yourself up, but definitely stop making changes based on Yahoo Finance.
Last edited by HomerJ on Fri Apr 16, 2021 9:08 pm, edited 3 times in total.
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Re: Market Timing Change
Are you sure you posted the correct link? What I read implied that we should take the long view despite a possible small downturn in May. I don't understand how an article like this could motivate anyone to sell anything.peddler12 wrote: ↑Fri Apr 16, 2021 7:39 pmThis is not the one I read the headline, but is as good as any.UpperNwGuy wrote: ↑Fri Apr 16, 2021 7:31 pmCan you post a link to the article? I'm always eager to learn how people are able to predict the future.
https://www.yahoo.com/finance/video/inv ... 59932.html
Re: Market Timing Change
Lol. It's all livesoft's fault
It's okay. OP will be fine. OP has a plan. It's only 2% of their portfolio in an undervalued stock with which they are already familiar and know how to value that has a 3% dividend. That's way less than the 5% in BTC everyone else gets away with.
"The only thing that makes life possible is permanent, intolerable uncertainty; not knowing what comes next." ~Ursula LeGuin
Re: Market Timing Change
I would have put 2-2.5% of that cash into a 2x leveraged ETF to get your effective equity exposure closer to your 50% target.peddler12 wrote: ↑Fri Apr 16, 2021 5:07 pm
livesoft I did not buy back what I sold, but I did take the cash from the sale and bought a stock that was out of favor this year. The stock was down a little over 5% for the year as of yesterday. I won't say what I purchased. I have two reports set up in Quicken. My stock and VTI as the benchmark. I will watch. The stock yields over 3%, and is currently well below fair market value. Years ago I owned this stock, so it was already in Quicken. Years ago there was an event that caused the stock to decline substantially. Because of this, I'm acquainted with the the risks of owning it. The value of this equity is 1.96% of my portfolio, and it is the only single stock I've purchased or will purchase. With all that said, that is how I handled my mistake. Forgive me for not listening to the other poster who said not to do anything for a few days or a couple of weeks. With this purchase, my AA is about 51%Stock/49%Bonds. I'm back to being about 50/50. I know that in the 2000-2002 decline my expected loss is about 14%. My sleep well at night can handle the $100,000.00 decline in my portfolio. livesoft I was thrilled when you responded to my thread. I also want to thank all the others that gave input into my mistake. I'll try not to pay attention to the financial porn again. BTW, I have an account with Morningstar which is how I located the equity that I bought. Thank you to everyone. I am grateful to have found Bogleheads all those years ago.
Put the remainder in bonds.
If, after a month or three, it then takes you up to 55% stock exposure, rebalance per your IPS rules and exchange any leftover geared shares for vanilla index.
2-2.5% leverage isn't going to blow up your whole port, and it's possibly less risky than the concentrated risk of a single stock.
What HomerJ said is more foolproof, though.
Albeit less entertaining.
Last edited by watchnerd on Fri Apr 16, 2021 9:23 pm, edited 1 time in total.
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Re: Market Timing Change
Nice job livesoft. Your incomplete vague answer got him to buy a single stock. You might want to recognize that people asking questions here probably aren't as set as you, so your responses matter. Please be more careful.
Peddler, it's only 2% of your portfolio, but you didn't really have to only buy something that was down recently. You could have just stayed with your new more conservative allocation or bought back into the total market index. Don't beat yourself up, but definitely stop making changes based on Yahoo Finance.
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I agree. I will not do so again.
Peddler, it's only 2% of your portfolio, but you didn't really have to only buy something that was down recently. You could have just stayed with your new more conservative allocation or bought back into the total market index. Don't beat yourself up, but definitely stop making changes based on Yahoo Finance.
[/quote]
I agree. I will not do so again.
Re: Market Timing Change
Heh, true enough.Beensabu wrote: ↑Fri Apr 16, 2021 9:06 pmLol. It's all livesoft's fault
It's okay. OP will be fine. OP has a plan. It's only 2% of their portfolio in an undervalued stock with which they are already familiar and know how to value that has a 3% dividend. That's way less than the 5% in BTC everyone else gets away with.
"The best tools available to us are shovels, not scalpels. Don't get carried away." - vanBogle59
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Re: Market Timing Change
Since you realize your mistake, you immediately buy back what you just sold.peddler12 wrote: ↑Thu Apr 15, 2021 3:02 pm Good Afternoon everyone,
I saw an article on Yahoo about taking profits in anticipation of a 10% correction in the near future. I feel so foolish that I acted on such an article. I took about 10% of my equity allocation out of the market. Settlement day is tomorrow. It's in cash. What are my best options? I hesitate to buy back in at a price higher that what I sold for and would wait for that price to return. There are several articles claiming imminent downtown. The Fed says economy is strong. I'm ashamed of this market timing mistake. Having been browsing the forum for nearly 10 years, I should know better. My IPS say's rebalance when my equity/bond allocation is out by about 5% or so. It was not. In fact it was very close to my target of 50/50 Stock/Bond. I did not follow my IPS. Now I'm at 44/56 stock/bond allocation. I apologize for creating another such thread. I've been using the search box and have ready many threads by others who have done the same thing. Thanks much.
Make sure you check out my list of certifications. The list is short, and there aren't any. - Eric 0. from SMA
Re: Market Timing Change
Hello all.
I have learned today that the equity I purchased recently is on Warren Buffet's list of 12 undervalued stocks. I like that. MORNINGSTAR brought the equity to my attention, and Warren Buffet has confirmed it to be a good choice. I will say I'm very fortunate. I'm the worlds worst stock picker and even worst market timer. I like the experts help. Have a great evening all. I have to admit I like playing in the market a little. It is fun. I promise never more than a couple of percentage points of my portfolio.
Mike
I have learned today that the equity I purchased recently is on Warren Buffet's list of 12 undervalued stocks. I like that. MORNINGSTAR brought the equity to my attention, and Warren Buffet has confirmed it to be a good choice. I will say I'm very fortunate. I'm the worlds worst stock picker and even worst market timer. I like the experts help. Have a great evening all. I have to admit I like playing in the market a little. It is fun. I promise never more than a couple of percentage points of my portfolio.
Mike
Re: Market Timing Change
Where did you find this list?peddler12 wrote: ↑Thu Apr 22, 2021 5:00 pm Hello all.
I have learned today that the equity I purchased recently is on Warren Buffet's list of 12 undervalued stocks. I like that. MORNINGSTAR brought the equity to my attention, and Warren Buffet has confirmed it to be a good choice. I will say I'm very fortunate. I'm the worlds worst stock picker and even worst market timer. I like the experts help. Have a great evening all. I have to admit I like playing in the market a little. It is fun. I promise never more than a couple of percentage points of my portfolio.
Mike
I can't see why Buffet would would to drive up the prices of stocks he thinks are good deals, unless they're just too small for him to bother with.
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Re: Market Timing Change
could Warren Buffet be wrong?peddler12 wrote: ↑Thu Apr 22, 2021 5:00 pm Hello all.
I have learned today that the equity I purchased recently is on Warren Buffet's list of 12 undervalued stocks. I like that. MORNINGSTAR brought the equity to my attention, and Warren Buffet has confirmed it to be a good choice. I will say I'm very fortunate. I'm the worlds worst stock picker and even worst market timer. I like the experts help. Have a great evening all. I have to admit I like playing in the market a little. It is fun. I promise never more than a couple of percentage points of my portfolio.
Mike
Has he always been right? (read his annual letters where he is honest about his mistakes)
Could morningstar be wrong?
Have they always been right?
It's hard to accept the truth when the lies were exactly what you wanted to hear. Investing is simple, but not easy. Buy, hold & rebalance low cost index funds & manage taxable events. Asking Portfolio Questions |
Re: Market Timing Change
It was probably on one of the Yahoo or Yahoo Finance sites. I can't say he drove up the prices of these equities. My holding dropped 1.6% today, but it's still doing better than VTI which I'm using for a benchmark.watchnerd wrote: ↑Thu Apr 22, 2021 5:06 pmWhere did you find this list?peddler12 wrote: ↑Thu Apr 22, 2021 5:00 pm Hello all.
I have learned today that the equity I purchased recently is on Warren Buffet's list of 12 undervalued stocks. I like that. MORNINGSTAR brought the equity to my attention, and Warren Buffet has confirmed it to be a good choice. I will say I'm very fortunate. I'm the worlds worst stock picker and even worst market timer. I like the experts help. Have a great evening all. I have to admit I like playing in the market a little. It is fun. I promise never more than a couple of percentage points of my portfolio.
Mike
I can't see why Buffet would would to drive up the prices of stocks he thinks are good deals, unless they're just too small for him to bother with.
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Re: Market Timing Change
Lessons:
1. Ignore the 'financial news'.
2. Follow your IPS.
3. Immediately get back on board with where you want to be (i.e., change your AA to your target).
1. Ignore the 'financial news'.
2. Follow your IPS.
3. Immediately get back on board with where you want to be (i.e., change your AA to your target).
The Sensible Steward
Re: Market Timing Change
hoo boy
Google search:
"warren buffett's list of 12 undervalued stocks"
https://www.kiplinger.com/investing/sto ... ng-q4-2020
https://money.usnews.com/investing/stoc ... ust-bought
https://www.investopedia.com/warren-buf ... ks-4773315
https://www.fool.com/investing/2020/12/ ... dervalued/
...and there are more articles.
There are a lot of stocks amongst those articles.
Here's something funny:
US Bancorp (USB) is touted in the Motley Fool article as being undervalued, implying a 'buy'.
Oh, but then in Kiplinger article, it says Buffet "reduced stake".
I'm not even going to get into the question of whether just because something is a good fit for Berkshire Hathaway, as a business, means it's a good fit for the individual investor.
Global stocks, IG/HY bonds, gold & digital assets at market weights 75% / 19% / 6% || LMP: TIPS ladder
Re: Market Timing Change
My company's profits and revenue fell this quarter. I'm down 6.41%. Oh the joys of owning individual stocks. The first week I owned it, it easily beat my VTI benchmark. Not anymore.
Re: Market Timing Change
Next week you can tax-loss harvest ... just before your investment pops 20%!!
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Re: Market Timing Change
Investing "articles" on most of those sites are garbage. Literally. They're below even the talking heads on TV, many written by content mills or minimum wage labor simply to attract ad views. They aren't garbage for the reason that it's hard to best the market; they're garbage because many are computer generated or submitted by random internet users (e.g. Seeking Alpha). They're the exact opposite of an expert's guidance.
Please do not assign any weight to something just because it's from Yahoo or assume Warren Buffett endorses a stock in a list like "Warren Buffett top stock picks."
Please do not assign any weight to something just because it's from Yahoo or assume Warren Buffett endorses a stock in a list like "Warren Buffett top stock picks."