All the "should I be 100% stocks" threads over the last year.

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Watty
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All the "should I be 100% stocks" threads over the last year.

Post by Watty »

When the market was near the high there were lots of threads advocating 100% stocks.

For example;

Why not go 100% stocks?
viewtopic.php?t=252506

Why I'm 100% stocks
viewtopic.php?t=262275

In this case, should I be 100% stocks?
viewtopic.php?t=265989

Are bonds really needed - why not 100% stocks?
viewtopic.php?f=1&t=249401#p3926183

Does 100% stocks make sense for very high net worth individuals
viewtopic.php?t=264903

Retired at 50. Staying 100% in stock Index Funds. Anyone else?
viewtopic.php?f=1&t=240480

Is it fine to have 100% of portfolio in VTSAX
viewtopic.php?t=250881

100% VTSAX (Vanguard Total Stock Mkt Idx Adm)??
viewtopic.php?t=237676

And LOTS more.

In many of these threads people tried to make an argument to have a reasonable bond asset allocation.

All that is water under the bridge though.

It would be good to consider if you are using an appropriate asset allocation and if not then you might want to rebalance to a reasonable asset allocation now. Reevaluating and changing to an appropriate asset allocation is a good thing to do so the mantra of "Stay the course" does not apply when you are on the wrong course.

The big question is just what an "appropriate asset allocation" is. For retirement money I like to look at a comparable target date fund to see what asset allocation they use to see if I am in the same ballpark.

Different companies(Vanguard, Fidelity, Schwab, etc) may use somewhat different asset allocation for target date funds for the same date so you may want to look at several of them and reconsider your asset allocation if yours is much different than most of them.

If you are not sure what asset allocation is right for you then you might want to create a new post asking for opinions on what asset allocation you should use.
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Re: All the "should I be 100% stocks" threads over the last year.

Post by phantom0308 »

+1
I can only hope all of the threads advocating eliminating international equities are just as wrong. It’s been a rough year.
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JoMoney
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Re: All the "should I be 100% stocks" threads over the last year.

Post by JoMoney »

There are lots of "100% stocks" and "Why bonds" threads every year.
Here's one from the market low in 2009:
Why not 100% equities
viewtopic.php?t=35984
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Re: All the "should I be 100% stocks" threads over the last year.

Post by 2015 »

Theory concocted in the dark away from how the world actually works is always woefully unprepared when it meets the harsh daylight of reality. The resulting bang up of theory always reminds me of what happened to the face of Tom Cruise in the movie "Vanilla Sky."
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Re: All the "should I be 100% stocks" threads over the last year.

Post by triceratop »

I'm 95% stocks now; if the market dips a bit more I'll be 100% stocks. Global market weight.

I did want to point out that I was probably in some of those threads discussing my 90-100% allocation to stocks. No, nothing has changed due to a bit of volatility. I'm very happy with my losses. To be very precise and clear about what I mean: advice to be 100% stocks isn't necessarily wrong when stocks tank.
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Re: All the "should I be 100% stocks" threads over the last year.

Post by MJW »

Why are we just assuming that all of these people are now suddenly running for cover?
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Re: All the "should I be 100% stocks" threads over the last year.

Post by Hyperborea »

MJW wrote: Sat Dec 22, 2018 3:38 am Why are we just assuming that all of these people are now suddenly running for cover?
Because it feeds into the worldview of those holding a 50/50 portfolio who have secretly regretted it while the market is going up. Some hold a 50/50 and are happy with it and that's fine. It's the one's who regret doing so and see a market downturn as their chance to "score" one on those holding higher equity allocations.
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Re: All the "should I be 100% stocks" threads over the last year.

Post by hithere »

So why is 100% stocks a bad idea if one is far from retirement and doesn't care about the volatility of stocks for one reason or another?
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Re: All the "should I be 100% stocks" threads over the last year.

Post by minimalistmarc »

100% stocks and loving the correction. Hoping it goes down more and stays down for a few years.

You only go 100% equities if corrections crashes don’t bother you in the slightest.
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Re: All the "should I be 100% stocks" threads over the last year.

Post by ignition »

I'm still 100% stocks, no regrets. Actually I'm happy the market is tanking. Cheap shares for me!

My investing horizon is 30 years+ so these small downturns don't bother me the slightest.
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Re: All the "should I be 100% stocks" threads over the last year.

Post by metacritic »

I'm 90% equities. I aim to stay here for at least another 10 years, until 55. Then I'll slowly ramp up my bonds.

The only reason I'm 90% equities over 100% is that I think it important to learn how bonds operate and how I feel about them before half my portfolio consists of them.
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Re: All the "should I be 100% stocks" threads over the last year.

Post by Risky Dude »

Australian Here...
100% stocks
12.5% Australian Shares Index
12.5% Australian Small Cap Index
12.5% REIT
12.5% Emerging Markets (50/50 large and small)
12.5% International(includes US) Large Cap
12.5% International Large Cap Value
12.5% International Small Cap
12.5% International Small Cap Value

Investing for me is a LONG TERM plan. This is nothing compared to what I am prepared for. Higher risk = Higher expected return. I will be buying stocks much cheaper now so why should I be worried when I plan to work for at least another 30 years?
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Re: All the "should I be 100% stocks" threads over the last year.

Post by wilked »

ignition wrote: Sat Dec 22, 2018 5:27 am I'm still 100% stocks, no regrets. Actually I'm happy the market is tanking. Cheap shares for me!

My investing horizon is 30 years+ so these small downturns don't bother me the slightest.
Agreed, I would love to see a further 25% downward correction
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Re: All the "should I be 100% stocks" threads over the last year.

Post by AlohaJoe »

I'm a bit over 90% stocks and retired and I haven't felt any need to change my position.

My portfolio was down far more in 2016, which was apparently so long ago nobody remembers it.......

That said, I do wish there were more check-ins from previous posters. The ones who were at 100% stocks or were "waiting for a drop" or whatever interesting situation they had that they posted about.
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Re: All the "should I be 100% stocks" threads over the last year.

Post by pokebowl »

That is a pretty big strawman defense you set up. Can you provide sources in those links you posted that all those individuals have given up on 100% stocks? Do investors choose incorrect asset allocations, you bet. The incorrect asset allocation can also be to include bonds or other fixed income too early on in their accumulation years.
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Re: All the "should I be 100% stocks" threads over the last year.

Post by nisiprius »

The thing I find amazing is the difficulty people seem to have in understanding that risk tolerance is a personal thing that cannot be argued about. Everybody seems to feel that their own stock allocation is somehow objectively right, and that it is possible to compute some correct amount of risk to take.

Of course I have a point of view, but my point of view is not that "100% stocks" is wrong for everyone. It is almost proverbial that financial risk is almost the stuff of life for some people. In the case of entrepreneurs it is almost proverbial that they have "made and lost several fortunes."

To me, the only questions that are appropriate to ask--and, unfortunately, can't be answered well--is: just how much risk, and what kind of risk is involved in a certain stock allocation (or other investment strategy)? And, what is my own risk tolerance... really?

And the question I have about, let's say the question "why not 100% stocks?" is that I think a fair number of people are not really willing to take that risk, and fudge both of the answers. They fudge "how much risk is there?" by looking in a biased way for reasons to understate or minimize the risks of stocks. The most dangerous form is "the stock market is risky for everyone else, but not for me (because I can tell the future.)" I can dodge the bullet, my technical analysis signal will fire and get me out at the right time, my stocks have less risk than everyone else's because they dividend stocks, etc. Another one is believing that a 50% drop is five times as bad as a 10% drop. Another is saying "I can tolerate the 'normal' fluctuations of the stock market, and I don't need to worry about the 'abnormal' ones because they're, you know, abnormal--and every one of them that has ever occurred in the past has been the result of unique situations, ten sigma events that are surely never going to recur."

That is not risk tolerance, that is failing to acknowledge and accept risk.

The other side of the question, "what is my risk tolerance," is failing to know, or acknowledge, how one is really going to feel about the prospects of financial loss. As with the pain of childbirth, even if you been through it, a few years later you can't remember what it really was like. In a detached way I can say that 2008-9 was really bad and that my wife and I were really terrified. I do remember something that seems incredible to me now. I remember thinking, more than half seriously, "oh, please, please, Dow, just get back to 10,000. If you do that I will sell everything and never buy stocks again." I didn't act on it. But, yes, I felt a panicky and desperate longing to see 10,000 again.

One error on the side of evaluating one's risk tolerance include simply ignoring psychology. "So, that is 'just' a psychological issue? Then there is no 'rational' reason. I am rational--I can simply will myself out of any inconvenient human emotions--and psychological issues should not be consideration for me." (Note: Human happiness itself is 'merely' psychological). Another is letting outside forces--other people, investment writers, risk tolerance questionnaires--"anchor" you to certain numbers. Psychologists have shown that simply seeing an irrelevant number affects our choice of other numbers! You need to be just as honest and accurate with yourself in assessing your risk tolerance as you can, and it needs to come from you.
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Of the people who have gotten this far, a certain percentage absolutely can look all this straight in the face and say "So? You didn't point out anything I didn't already know. I do understand the risks and I do understand myself."
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OkieIndexer
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Re: All the "should I be 100% stocks" threads over the last year.

Post by OkieIndexer »

I'm man enough to admit I posted a "Why not 100% Emerging Markets?" thread here back in late 2007 when Emerging Markets had been in a massive bull market for 5 years and I was a 26 year old who had been investing less than 2 years at the time. I ALMOST (almost!) put my entire IRA in the FXI China ETF at the very tippy top in Oct. 2007. "China is the future and nothing is going to stop their market." Wow, that was silly. Glad I didn't do that, I would still be down -29% after 11 years. Valuethinker wisely told me in that thread "where were you in 2003?"

NOW might be a good time to be considering 100% Emerging Markets after 11 years of terrible performance and reasonable valuations, though. :mrgreen:
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Re: All the "should I be 100% stocks" threads over the last year.

Post by TylerS7 »

I guess I’m just not sure what the OP is suggesting bonds would be doing for me right now as a 30 year old. According to personal capital I would be down 12.5% this year if I sold. But I don’t have to sell for many decades, so the current downturn is pretty irrelevant. I don’t understand the suggestion that NOW is the time to re-evaluate asset allocation. Why? I would think that during big market movements is the absolute worst time to re-evaluate your asset allocation.
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Re: All the "should I be 100% stocks" threads over the last year.

Post by keystone »

hithere wrote: Sat Dec 22, 2018 4:18 am So why is 100% stocks a bad idea if one is far from retirement and doesn't care about the volatility of stocks for one reason or another?
I think it's a perfectly reasonable strategy if you're decades away from retirement and I think most Bogleheads would agree with that. Even if you're closer to retirement it's not necessarily a terrible strategy if you can stomach the losses.
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Re: All the "should I be 100% stocks" threads over the last year.

Post by runner3081 »

We are 95+ percent equities. No regrets.

We are also about 15ish years from possible early retirement.

The monthly investments will continue, yawn.
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Re: All the "should I be 100% stocks" threads over the last year.

Post by JohnDindex »

I’m 100% equity 50/50 itot/ixus I was on an age -20 path several months back but changed IPS. I don’t see that fixed income does much to dampen volatility until you get a pretty good slug of it....like 25%.
I’m also not sure if volatility and standard deviation should be a big focus for someone in their 30’s who is accumulating.

I have been rebalancing and TLH

If I counted my cash EF I am not 100% equity, I wonder what happened to cash as an asset class?? Maybe Schwab was into something with that idea....
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Re: All the "should I be 100% stocks" threads over the last year.

Post by F150HD »

Hyperborea wrote: Sat Dec 22, 2018 3:46 am
MJW wrote: Sat Dec 22, 2018 3:38 am Why are we just assuming that all of these people are now suddenly running for cover?
Because it feeds into the worldview of those holding a 50/50 portfolio who have secretly regretted it while the market is going up. Some hold a 50/50 and are happy with it and that's fine. It's the one's who regret doing so and see a market downturn as their chance to "score" one on those holding higher equity allocations.
LOL
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Re: All the "should I be 100% stocks" threads over the last year.

Post by stemikger »

If you are inclined to be 100% stocks the market dropping should not matter. Having said that, there are some people who should not invest in stocks because they can't handle the volatility. However, if you are a real investor and don't care about what happens in the short term, you will be rewarded holding 100% stocks.

For the record I am a 60/40 guy because it enables me to look at these big drops with the proper perspective and stay the course. For those of you who are not there yet, stop looking at the market and stop looking at your portfolio. Ten years from now, you will not even notice what the market did today.
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Re: All the "should I be 100% stocks" threads over the last year.

Post by DrivingFun »

No offense but this is a pretty low quality post. Most of us that are 90%-100% equities are young and have decades until retirement. A 15%-20% drop is an opportunity if anything. Not even sure the point you're trying to make. The fact that the thread starter posted and went away almost seems like a troll post. And I would definitely not recommend rebalancing now into some other more conservative allocation :oops:
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Re: All the "should I be 100% stocks" threads over the last year.

Post by jeffyscott »

OkieIndexer wrote: Sat Dec 22, 2018 6:56 am I'm man enough to admit I posted a "Why not 100% Emerging Markets?" thread here back in late 2007 when Emerging Markets had been in a massive bull market for 5 years and I was a 26 year old who had been investing less than 2 years at the time. I ALMOST (almost!) put my entire IRA in the FXI China ETF at the very tippy top in Oct. 2007. "China is the future and nothing is going to stop their market." Wow, that was silly. Glad I didn't do that, I would still be down -29% after 11 years. Valuethinker wisely told me in that thread "where were you in 2003?"

NOW might be a good time to be considering 100% Emerging Markets after 11 years of terrible performance and reasonable valuations, though. :mrgreen:
One thing with that is when you were 26, it was probably a lot less $ than now. I know when I was 26, I'd have had no problem going 100% EM, would've been $0 :D .

Currently at 7% of portfolio in EM, which is about as high as I am willing to go. We have only 40% in stocks, oh wait, make that 38% :( , so EM is now about 18% of equities. Had we had the same dollar amount in EM 15 years ago, that would've represented 100% of our portfolio (or with inflation adjustment, about 70%, which would've been about 100% of equities back then).
The two greatest enemies of the equity fund investor are expenses and emotions. ― John C. Bogle
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Re: All the "should I be 100% stocks" threads over the last year.

Post by LiveSimple »

We are 100% equities, just staying the course as per our IPS. Slice and Dice portfolio so will rebalance accordingly..
bling
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Re: All the "should I be 100% stocks" threads over the last year.

Post by bling »

this is the first time where i'm testing my risk tolerance for real. i was just starting out in 2008 so i barely had any money to lose, but 10 years later i've accumulated quite a bit, and now i'm seeing significant (paper) losses.

i'm in my mid 30s, currently 75/25, and....nothing. i'm not feeling fearful, not ready to sell everything and convert to cash, just...nothing. guess i should have been 80/20 or 85/15. ah well, no more bonds for me anyways until the market recovers.
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Re: All the "should I be 100% stocks" threads over the last year.

Post by sabtastic »

watty the 100%ers are going to rub it in your face when this bear is over!! :mrgreen: :mrgreen: :mrgreen:

On a serious note please don't encourage selling. I am trying to talk two of my younger acquaintances out of selling everything and buying gold. This is the first selloff for many and they are really freaking out. Maybe it is because it is so soon after the bitcoin bust but the panic is so thick you can cut it with a knife.

Remember, if you don't need the $$ for 30+ years, there is no better way to preserve wealth outside equities.

That being said, if you have your house down payment in 100% equities I WOULD sell that right now.
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Re: All the "should I be 100% stocks" threads over the last year.

Post by Call_Me_Op »

hithere wrote: Sat Dec 22, 2018 4:18 am So why is 100% stocks a bad idea if one is far from retirement and doesn't care about the volatility of stocks for one reason or another?
Problem is how do you know you are far from retirement? You can certainly hope that's the case, but life can throw curve balls. That said, if you are in your 20's or 30's and can stomach extreme volatility, 100% equities is a reasonable thing to do.
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Re: All the "should I be 100% stocks" threads over the last year.

Post by indexonlyplease »

Depends on age I believe and the career you chose. I was 100% stock funds until I retired 2 years ago. Now 50/50. Why because I don't need the extra risk anymore.

My son 22 Vangaurd target fund 2060. I believe 95% stocks. Why he is young and has plenty of time. But the biggest reason in th target date fund is the mistakes people make with investing I believe is far worse then the stock market returns.

Only problem most find out about their mistakes when it's to late.
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Re: All the "should I be 100% stocks" threads over the last year.

Post by Captain kangaroo »

I am 90/10.

Buffet said all most people need is 90% in an index fund and 10% in treasuries.

Good enough for me.
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Re: All the "should I be 100% stocks" threads over the last year.

Post by greenhill »

If the recent slump continues I would not be surprised with 100% bonds threads popping up.
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Re: All the "should I be 100% stocks" threads over the last year.

Post by maxDrawdown »

I'm near 100% equity too, but not fully passive (I'm using 6- and 12-month momentum, recent volatility and correlation to current portfolio to choose from a universe of about 80 factor, minimum volatility, region, sector and size ETFs -- or at least trying to do so; still tinkering with it).

I'm finding that the most stressful part are not the losses per se, but having to make decisions while realizing that (in some sense) I know nothing, and in the face of strong uncertainty and doubt about whether these tilts will work in the future, or whether I should just throw in the towel and go 100% passive global market-cap weight. It's almost like I'm stressing more about my performance relative to the MSCI ACWI IMI (my choice of benchmark) than about the absolute losses.

With fully passive investing, I think I'd find it comforting to know that I can't really do anything wrong, in the sense that I would be immune to being "outsmarted", and would be guaranteed to get the same return as the very smart active sector, in aggregate. I'm not planning on using my money for a long time, and I have pretty strong confidence in the equity risk premium for the long term. I think I could tolerate the risk of 100% equity pretty well if it wasn't for this additional doubt about the tilts.
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Watty
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Re: All the "should I be 100% stocks" threads over the last year.

Post by Watty »

hithere wrote: Sat Dec 22, 2018 4:18 am So why is 100% stocks a bad idea if one is far from retirement and doesn't care about the volatility of stocks for one reason or another?
There were a couple of posts that questioned this.

Here is a link to section of the Boneheads Philosophy page about taking too much or too little risk that would be worth rereading.

https://www.bogleheads.org/wiki/Boglehe ... ittle_risk

One thing I would add is that you may not really know when you will retire and how your career will work out until you are able to retire.

I worked in IT before I retired and I saw lots of relatively high paid people get laid off that were never able to find jobs that paid nearly as well. I also know several people that became disabled or had a spouse die which totally changed their financial plans.

It would also be good to read this Vanguard white paper on investing. The section on asset allocation starts on page 8.

https://about.vanguard.com/what-sets-va ... Online.pdf

Note that in Figure 5 historically going from 100% stocks to 80/20 only reduced the historical return from 10.2% to 9.5% but it greatly reduces the volatility by that is not real clear in that graph. Going to 90/10 only reduced the historical return from 10.2% to 9.9% so even for someone that is super aggressive there is little reason to not have at least 10% stock.
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Re: All the "should I be 100% stocks" threads over the last year.

Post by autopeep »

wilked wrote: Sat Dec 22, 2018 6:12 am
ignition wrote: Sat Dec 22, 2018 5:27 am I'm still 100% stocks, no regrets. Actually I'm happy the market is tanking. Cheap shares for me!

My investing horizon is 30 years+ so these small downturns don't bother me the slightest.
Agreed, I would love to see a further 25% downward correction
I don't care if you are 100% stock or not. That said, substantial stock market declines have real consequences for some people. Cheering for prolonged market down turns is a pretty odious position.
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Watty
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Re: All the "should I be 100% stocks" threads over the last year.

Post by Watty »

DrivingFun wrote: Sat Dec 22, 2018 8:33 am The fact that the thread starter posted and went away almost seems like a troll post.
I posted it before I went to bed. :oops:

I don't claim to always be right(and being corrected is a good way to learn) and differences of opinion can mean that two people have have different valid views on a topic and they need to disagree but be careful about making what is called an "Ad hominem" argument where you focus on the person and not what they say.

https://en.wikipedia.org/wiki/Ad_hominem

It would be much more interesting to here a good case as to why 100% stocks is right for some situations and how to determine if you are in that situation or not.
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Re: All the "should I be 100% stocks" threads over the last year.

Post by GCD »

One caveat to this is that very few people are really 100% stock. My investible assets were 100% stock until about a year ago, but due to the fact that I own a house I don't think you can technically say I was 100% stock except for that period of time before I was a homeowner.

With the exception of home ownership, I was 100% stock from 1995 through 2017. Went through all the crashes and never wavered. Just kept plowing more money in. And I'm real happy about my returns over that time.

In 2017 my wife and I realized we had hit our goal for our 529 and shifted that all to 50% bond/50% short term reserves. That's money I plan on spending soon.

However, we LBYM on our pensions so the rest of our investible assets remain 100% stock. But that's money we don't really need and plan on leaving to our kids. So it's kind of an experiment to see how big we can grow it over 30-40 years. Obviously with that long term view and my past track record I don't worry that I'll panic and sell off during a downturn.

If your situation is different, by all means do something else. But don't assume that those of us with heavy stock allocations will panic.
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Re: All the "should I be 100% stocks" threads over the last year.

Post by tainted-meat »

This thread is about as predicable in a down market as the 100% stock threads are in an up market. :thumbsdown
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Re: All the "should I be 100% stocks" threads over the last year.

Post by wootwoot »

It's also funny how many TLH threads there are now. Any correlation between the 100% stocks crowd and the "explain to me how TLH works" crowd that is here now?
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privatefarmer
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Re: All the "should I be 100% stocks" threads over the last year.

Post by privatefarmer »

If you count my fixed rate mortgage as leverage, I’m 200% stocks. Not the least bit concerned. Do I have any inking to sell equities and pay off my mortgage? No. That’d be ridiculous. I’m 34 years old.

100% equities, plus a fixed rate mortgage, when you’re young is absolutely reasonable and I think prudent. I have 40+ years to invest, or my wife will should I die early. I have ZERO reason to own fixed income.
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LiveSimple
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Re: All the "should I be 100% stocks" threads over the last year.

Post by LiveSimple »

Watty wrote: Sat Dec 22, 2018 10:32 am
It would be much more interesting to here a good case as to why 100% stocks is right for some situations and how to determine if you are in that situation or not.
You have to figure that out for yourself. My plan and thought may not working for you or my situation and your situations are different.

I know a retiree, who claims he is 60% individual stocks and 40% in mutual funds. He is happy and chuckling along, compared to him I am 100% index funds, so I am happy. I assume he would have got Procter & Gamble and such, 40 / 50 years ago and reinvested all the dividients.
Last edited by LiveSimple on Sat Dec 22, 2018 10:44 am, edited 1 time in total.
restingonmylaurels
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Re: All the "should I be 100% stocks" threads over the last year.

Post by restingonmylaurels »

Probably just like everyone, I have paid a bit more attention to my portfolio of late. Green seems to be a rarely viewed color on the stock market indices recently, reminding me of 10 years ago.

Reading this thread and checking my own portfolio at the end of this week, three thoughts have come to mind, which I have not fully sorted out yet to see if they all fit together:

1. Those who are 100% stocks, unless you have stomachs of cast-iron and nerves of steel, I find it hard to believe these are seven-figure portfolios. It really is all about how much money you truly have at risk, so it would be nice if people who make it more clear the magnitude of what 100% equities really means to them. A $20,000 100% equities portfolio has a bit less at risk than a $2,000,000 100% equities portfolio.

2. In opposition to that, I noted that, except for maybe yesterday, I am basically even for the year. So on the YTD perspective, a big yawn, despite the clarion call of capitulation from Wall Street. Sure I was wealthier two months ago and may be again two months from now.

3. I also noted my ten-year return on the VG site, and I am way up because I kept my exposure to risk during those bad days a decade ago and did not change anything. Will do the same this time. Not as good as the 100% equities crowd but have slept well since then.
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F150HD
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Re: All the "should I be 100% stocks" threads over the last year.

Post by F150HD »

I'm waiting for the mathematically challenged folks to post that they're 60% equities and 50% bonds.
Long is the way and hard, that out of Hell leads up to light.
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MEA
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Re: All the "should I be 100% stocks" threads over the last year.

Post by MEA »

Watty wrote: Sat Dec 22, 2018 12:16 am When the market was near the high there were lots of threads advocating 100% stocks.

For example;

Why not go 100% stocks?
viewtopic.php?t=252506

Why I'm 100% stocks
viewtopic.php?t=262275

In this case, should I be 100% stocks?
viewtopic.php?t=265989

Are bonds really needed - why not 100% stocks?
viewtopic.php?f=1&t=249401#p3926183

Does 100% stocks make sense for very high net worth individuals
viewtopic.php?t=264903

Retired at 50. Staying 100% in stock Index Funds. Anyone else?
viewtopic.php?f=1&t=240480

Is it fine to have 100% of portfolio in VTSAX
viewtopic.php?t=250881

100% VTSAX (Vanguard Total Stock Mkt Idx Adm)??
viewtopic.php?t=237676

And LOTS more.

In many of these threads people tried to make an argument to have a reasonable bond asset allocation.

All that is water under the bridge though.

It would be good to consider if you are using an appropriate asset allocation and if not then you might want to rebalance to a reasonable asset allocation now. Reevaluating and changing to an appropriate asset allocation is a good thing to do so the mantra of "Stay the course" does not apply when you are on the wrong course.

The big question is just what an "appropriate asset allocation" is. For retirement money I like to look at a comparable target date fund to see what asset allocation they use to see if I am in the same ballpark.

Different companies(Vanguard, Fidelity, Schwab, etc) may use somewhat different asset allocation for target date funds for the same date so you may want to look at several of them and reconsider your asset allocation if yours is much different than most of them.

If you are not sure what asset allocation is right for you then you might want to create a new post asking for opinions on what asset allocation you should use.
I love seeing all the posts from the young folks that seem to really understand what they are doing. I agree with them. Take the risk when you’re young. That way you won’t have to do it when you get older.

I think most people understand that if you don’t have enough money to take care of your needs then there’s really nothing there worth protecting. Sometimes trying to grow your assets is a better choice than trying to protect them.

I also think that people know when they have something worth protecting and will do so when the time is right for them.

Advising people to change course when the market is down 20% is just really bad advice.



Having said all that though I do think that everyone should have a bond fund no matter what your age is. Having a small amount in bonds will do two things. 1 You will get a education in how bond funds work, and managing risk. 2 when the time comes it will be a lot easier to change your asset allocation. You will already have your foot in the door, and it will just make it easier.
“Stay the course is the most important piece of advice I can give you.”-Bogle
RollTide31457
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Re: All the "should I be 100% stocks" threads over the last year.

Post by RollTide31457 »

Sticking with our cash is king strategy.
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Watty
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Re: All the "should I be 100% stocks" threads over the last year.

Post by Watty »

jeffyscott wrote: Sat Dec 22, 2018 8:37 am One thing with that is when you were 26, it was probably a lot less $ than now. I know when I was 26, I'd have had no problem going 100% EM, would've been $0 .
You did not exactly say it but several people eluded to the argument that being young means that you can take a lot of risk since there is plenty of time to make up for any losses if things turn out badly.

There is some truth in that which is why a higher percentage of stocks is recommended for younger people.

One thing to remember though is that being young is a double edged sword since any money that you lose through taking excessive risks could have been invested for decades and might be a large amount by the time you are ready to retire.
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LiveSimple
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Re: All the "should I be 100% stocks" threads over the last year.

Post by LiveSimple »

restingonmylaurels wrote: Sat Dec 22, 2018 10:43 am 1. Those who are 100% stocks, unless you have stomachs of cast-iron and nerves of steel, I find it hard to believe these are seven-figure portfolios. It really is all about how much money you truly have at risk, so it would be nice if people who make it more clear the magnitude of what 100% equities really means to them. A $20,000 100% equities portfolio has a bit less at risk than a $2,000,000 100% equities portfolio
Here is a perspective as well.

If one / couple has amassed a $2M portfolio with 100% stocks with an annual salary of say $200K, it also means that they lived well below the means for decades and they are at less risk when the $2M portfolio falls down in paper losses. Also this $2M may be for the next generation and being 100% is the best way they figured out.

In the end if one do not sell at low or seeing the volatility, they are okay with 100% equities. I remember Livesoft stating that a balanced portfolio provides much higher returns than a 100% equities as well. Need to review that as well.
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whodidntante
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Re: All the "should I be 100% stocks" threads over the last year.

Post by whodidntante »

wootwoot wrote: Sat Dec 22, 2018 10:37 am It's also funny how many TLH threads there are now. Any correlation between the 100% stocks crowd and the "explain to me how TLH works" crowd that is here now?
TLH is useful to understand if you have a more conservative 99% stock allocation, too. Or let's die a little and double the bonds, 98% stocks, still useful. :twisted:
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LiveSimple
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Re: All the "should I be 100% stocks" threads over the last year.

Post by LiveSimple »

MEA wrote: Sat Dec 22, 2018 10:45 am
Advising people to change course when the market is down 20% is just really bad advice.
These words are valuable :sharebeer
Last edited by LiveSimple on Sat Dec 22, 2018 10:56 am, edited 1 time in total.
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