The Calm Post - Stay the course thread.

[max12377]

Hi Bogleheads-

Since we have a stocks skyrocket and stocks plummet thread, can we start one where we can go for refuge ? I love to read posts from those who are calm and riding out the volatility both on the upside and downside. I see plenty of boasting on the upside and hand wringing panic on the downside. I know .. it’s human nature and I have the same reactions, trust me. Just looking to see if we can get a calmer heads prevail thread where we post things like Jack’s reassuring wisdom or Taylor’s gems as we deal with the inevitable volatility.

I think this panic will subside but even if there are challenges ahead I want a team of Bogleheads to help us all stay the course in true Bogleheads fashion.

Max

[Triple digit golfer]

I'm in! My asset allocation is one that allows me to never be the best or worst performer.

Our bond allocation is enough to last us more than two years if necessary.

Jack Bogle:

No matter what happens, stick to your program. I've said "Stay the course" a thousand times, and I meant it every time. It is the most important single piece of investment wisdom I can give to you.

[Pinotage]

Excellent idea - thank you for starting the thread.

In for the calmness.

[L82GAME]

Count me in!

[Freedom76]

So much YES!
Stay calm, Stay the Course!

Thank you!
Freedom76

[NearlyRetired]

A good idea for a thread

I have recently retired (1 month ago) so no longer accumulate any funds (just spending the money ), so I am watching all this turmoil with interest as it is a "first" for me.

However I have no intention of changing my AA (currently 43/57) as this will eventually all blow over (and I see this as a training/proving ground to see how I react as markets drop with my AA - after all this is new to me and I don't believe until you experience a drop that you truly know what your "sleep soundly at night" AA is!!)

[zonto]

Cheers! The forum’s discussions this week have been relatively tempered, but many people in Facebook finance groups I follow have been losing their mind this week.

I’m a young accumulator with a high savings rate and a globally diversified 70/30 portfolio. I’m rather conservative by nature and profession. After researching extensively, last summer I moved my bond allocation from Vanguard’s suggested 70/30 US/international total bond index split to 100% long term U.S. Treasurys. Many posts by Bogleheads users like vineviz were instructive to me during my research period. I have been pleased at the performance of my portfolio during the recent market stress, especially EDV (Vanguard Extended Duration [Zero Coupon] Treasury Index).

Even with the large pops to my bond funds recently, no rebalancing triggers have occurred so I’ll just sit tight.

[GoldenFinch]

I think your idea of a calm thread is a nice idea, but I wonder whether the truly calm people need a thread. If we are all calm, what will we discuss?

Sincerely,

GoldenFinch

[260chrisb]

A terrific idea!! I'm in. The post just below yours was the dreaded "US Stocks in free fall" which has just shy of 14,000 replies and for the life of me I can't understand how to follow. I'm good, my plan and allocation are set and I'm making no changes or selling. I protected my first year of retirement (in two years) in December and plan to do the same for my second year this December provided we finish the year positive and if not, then I'll do it in late 2021.

The Calm Post-Stay the course thread; great idea!!

[Old_Dollar]

I'm actually kind of excited. My biweekly 401k contribution occurs this Friday. I'll be calmly excited

[F150HD]

is this some form of Bogleyoga? Boga?

[Ferdinand2014]

Fidelity calmly auto-invested the weekly contribution into my S&P 500 index fund at a 6.5% discount compared to last week. I hope to do this another 152 times before I stop contributing. I know that every week the number of shares of FXAIX I own keeps going up. Never down. I also know that the dividend yield on my S&P 500 index fund is higher than the 10 year treasury.

[Sconie]

Two thumbs up! What is going on now in the markets is just "noise"-----and while I certainly could be wrong, I bet that in a year or two people will look back on this and wonder what all the angst and nervousness was about .

[Stinky]

Great idea for a thread!

While I do follow the "free fall" and "soaring" threads on this site, at my heart I'm a buy-and-hold kind of guy. I stayed the course and remained fully invested though the 2007-8 debacle, and I have no doubt that I'll do the same this time around.

I expect no talk of "dead cat bounces" on this thread.

[tombonneau]

I'm 90/10 (mostly VTWAX), 43, modest six-figure portfolio, and I'm left wondering what all the fuss is about for accumulators. I plan to run the numbers and contribute to my 401k funds today or tomorrow per usual. HSA and IRA contributions should hit shortly after. I don't know maybe when I run my spreadsheet to see where I need to direct 401k funds and see how much less I have since end of January I might feel a bit of a sting but I'm in it for the long haul. Portfolio doesn't even cross my mind when I put my head on the pillow.

Looking back on it, futzing about with crypto back in 2018 was probably a great behavioral training ground. I don't think I'll really start getting annoyed until we're down 20%.

[Third Son]

A good idea for a thread

I have recently retired (1 month ago) so no longer accumulate any funds (just spending the money ), so I am watching all this turmoil with interest as it is a "first" for me.

However I have no intention of changing my AA (currently 43/57) as this will eventually all blow over (and I see this as a training/proving ground to see how I react as markets drop with my AA - after all this is new to me and I don't believe until you experience a drop that you truly know what your "sleep soundly at night" AA is!!)

Yes... I agree. I retired last week and don't have a clue where this is going, and however mindful, I realize there is not anything I should do about it. However I am similar to you in that I am 45/55 with about two years of cash reserves so we should be good. I actually like rice and beans On top of that I just had foot surgery so I have plenty of opportunities to dwell on the day's events

[quisp65]

I just retired and I'm moving my 403b & 401A now. When that transfer reaches my settlement account I think I'll wait till market has a good day before I put it back in. I guess that's a little off course. Normally I wouldn't care so much but I'm at the one time in my life where I want my account to be high. My 403b plan gave me wrong info in writing and stated I could do periodic withdrawals at 55. Turns out they were wrong so I'm setting up a 72t SEPP and if the account balance isn't high enough I'll get forced into 5 years living off of a smaller amount. Hard to get a lot of money off a 72t SEPP when the interest rate is so low.

[JohnDindex]

Fidelity calmly auto-invested the weekly contribution into my S&P 500 index fund at a 6.5% discount compared to last week. I hope to do this another 152 times before I stop contributing. I know that every week the number of shares of FXAIX I own keeps going up. Never down. I also know that the dividend yield on my S&P 500 index fund is higher than the 10 year treasury.

I thought you could only auto invest monthly with fidelity? Is that a 401k or individual account ?

[augryphon]

Great idea to support each other when things get squirrelly! I do with investing what i do what i do at work when the unexpected happens, I stop, take a deep breath, remember that I’ve seen this or something very similar before, then since I am prone to action, I ask myself “what is one thing that I need to do right now that I am certain will not make this worse.” I do that one thing, then i look for another. Taking action, even menial ones, clears my mind to see the problem more clearly.

For market upsets, my one thing is to read “Bogleheads,” which immediately re-centers my thinking toward staying the course. Then i “don’t do something, I just stand there.” This strategy kept me on course in 2007-9, when the only changes i made in the face of that turndown were my annual rebalances.

[Ferdinand2014]

Fidelity calmly auto-invested the weekly contribution into my S&P 500 index fund at a 6.5% discount compared to last week. I hope to do this another 152 times before I stop contributing. I know that every week the number of shares of FXAIX I own keeps going up. Never down. I also know that the dividend yield on my S&P 500 index fund is higher than the 10 year treasury.

I thought you could only auto invest monthly with fidelity? Is that a 401k or individual account ?

So did I until another poster pointed out that you can simply add another auto-investment to each account. Accounts and trade > account features > payments and transfers > automatic transfers and investments > set up automatic transfer or investment. Simply add a second, or third or fourth or however many automatic transfer or investments you want for each account. Instead of 1 auto investment for each account, you make 2,3,4 or 5 automatic investments for each account. Just keep clicking the blue tab and add in as many automatic investments. I have mine set up on every 1,7,14,21,28 day of every month so technically 60/ year as they do not allow day of week, but day of month. You will make what looks like multiple separate automatic investments for one account.

[Explorer]

My AA is where I want it to be... so I am calm.

I am taking advantage of sharp gyrations to rebalance.. last few days I have been a buyer of equities. While days like the last few occur often enough (we tend to forget), they do represent an opportunity to nibble.

Good Luck to all.

[columbia]

My take: if you’re thinking about selling, you probably missed your chance.

[Cousin Eddie]

Great thread. I think if you know deep down that you are going to be OK then it all becomes noise and panic selling just doesn't make sense.

The secret is that we are all going to be OK and our lives will continue regardless of what the market does.

Buy and hold and let the market do its thing.

[B. Wellington]

Hi Bogleheads-

Since we have a stocks skyrocket and stocks plummet thread, can we start one where we can go for refuge ? I love to read posts from those who are calm and riding out the volatility both on the upside and downside. I see plenty of boasting on the upside and hand wringing panic on the downside. I know .. it’s human nature and I have the same reactions, trust me. Just looking to see if we can get a calmer heads prevail thread where we post things like Jack’s reassuring wisdom or Taylor’s gems as we deal with the inevitable volatility.

I think this panic will subside but even if there are challenges ahead I want a team of Bogleheads to help us all stay the course in true Bogleheads fashion.

Max

Great idea! I like watching old Youtube clips of Jack being interviewed. Calm and always steadfast in his beliefs. No boasting. No fear or panic. One of the most intelligent and humble human beings ever.

The most calm posters here seem to have a solid plan, a solid AA, regardless if that AA is 90/10 or 50/50 etc. Are well diversified, "have an anchor to windward" and are able to stay the course.

[fredflinstone]

I own a well-diversified portfolio consisting of stocks, bonds, gold, gold miners, and cash. I had a feeling that coronavirus would rattle the markets (and said so on this Forum), but I did not change my asset allocation and will not do so. Stay the course. Ignore the noise.

[pharmermummles]

While I'm 100% with you in principal, how will this thread ever be as entertaining as the sarcastic posts in the other two threads? Can we still calmly crack wise?

[NearlyRetired]

While I'm 100% with you in principal, how will this thread ever be as entertaining as the sarcastic posts in the other two threads? Can we still calmly crack wise?

YES, YES

[SmileyFace]

I thought the entire point to the other 2 threads was already to stay calm and follow course in the face of the media/market excitement. Not sure why we need a third.

[Greg in Idaho]

Om....

I had planned to rebalance and slightly reduce our equity allocation for the last few weeks, but we can only do that without a taxable event in my wife's retirement accounts, and it just didn't happen...but even if I had that would have been at most a 5% shift, which wouldn't have made a big difference.

The market is rebalancing for me, so I guess I'll just ignore it unless/until my allocation gets off in the other direction...

[Gropes & Ray]

Someone told me the stock market went down 1000 points. They didn't say Dow points or S&P points! Hilarious.

Anyway, Friday is pay day and the system will auto contribute to my retirement investments.

[9-5 Suited]

Not sure how this thread will turn out, but I appreciate the creative idea to make it.

Those other two threads annoy me honestly. I try to avoid watching daily market fluctuations, but you can literally tell if the market is up or down 1% every single day by which of those threads is toward the very top of the forum. There is too much activity in them, and the discussion is not very interesting to follow (very niche discussion content).

[hagridshut]

Not sure how this thread will turn out, but I appreciate the creative idea to make it.

Those other two threads annoy me honestly. I try to avoid watching daily market fluctuations, but you can literally tell if the market is up or down 1% every single day by which of those threads is toward the very top of the forum. There is too much activity in them, and the discussion is not very interesting to follow (very niche discussion content).

Another indicator that sentiment has turned extremely negative is that this forum won't load or refresh consistently. I've gotten timeout errors over the past 2 days, which for me is a buy/contribute signal.

[Rowan Oak]

Have you read Taylor Larimore’s post What experts say about "Stay-the-Course"

Bogleheads:

"Stay-the-course" is very important for investment success. This is what experts say:

Frank Armstrong, advisor and author of The Informed Investor: "Endless tinkering is unlikely to improve performance, and chasing last period's stellar achiever is a losing strategy."

Barber Odean Study: "Of 66,465 households with accounts at a large discount broker during 1991 to 1996, those that trade most earn an annual return of 11.4 percent, while the market returns 17.9 percent. Our central message is that trading is hazardous to your health."

William Bernstein, author of Four Pillars of Investing: If you become upset when one of your asset classes does poorly, even when the rest of your portfolio is doing well, then you should not be managing your own money."

Jack Bogle: "Stay the Course. No matter what happens, stick to your program. I've said "Stay the course" a thousand times, and I meant it every time. It is the most important single piece of investment wisdom I can give to you."--"We say stay the course. But before you stay the course, make sure you're on the right course."

Bogleheads Guide to Investing: "Wall Street can't stand buy-and-hold strategies because brokers need trading activity to make money."

Jack Brennan, former Vanguard CEO: "If you're determined to succeed at investing, make it your first priority to become a buy-and-hold investor."

Warren Buffett: "Inactivity strikes us as intelligent behavior."

"Andrew Clarke, author of Wealth of Experience: "Setting a goal, developing an appropriate asset allocation, and selecting a handful of funds are not hugely complex tasks. The hard part comes next: Battling your emotions so that you can stick with your plan through thick and thin."

Jonathan Clements, author and Wall Street Journal columnist: "Take my word on it. Buy-and-hold is still your best long-run strategy."

Phil DeMuth, adviser and co-author of seven investment books: "The investor says to his adviser: 'Every year you tell me to do nothing. What do I need you for?' The adviser replied: 'Every year you need me to keep your from doing anything.' "

Paul Farrell, author of Lazy Persons Guide to Investing: "In a study of 66,400 Merrill Lynch investors, professors Odean and Barber discovered that buy-and-hold investors beat the more active investors by a fairly sizable margin: 18.5% to 11.4% over a six-year period."

Rick Ferri, advisor and financial author: "Write down your strategy -- and stay-the-course."

Steve Forbes: "Everyone is a long-term investor until the market goes down."

Alan Greenspan, former Chairman of the Federal Reserve: "The best strategy for equity investor has always been buy and hold, and forget it."

Mark Hebner, author of "Index Funds": "Prices change to reflect news which is both random and unpredictable. Stock picking and market timing don't work. Stay the course in a risk-appropriate index portfolio and invest and relax."

Morgan Housel, financial columnist: "Do nothing" are the two most powerful -- and underused -- words in investing. The urge to act has transferred an inconceivable amount of wealth from investors to brokers."

Michael LeBoeuf, author of The Millionaire in You: "Simple buy-and-hold index investing is one of the best, most efficient ways to grow your money to the ultimate goal of financial freedom."

Jessie Livermore, famous stock trader: "The big money is not in the buying or the selling, but in the sitting."

Burton Malkiel, author of Random Walk Down Wall Street: "Buying-and-holding a broad-based market index fund is still the only game in town."

Paul Merriman: "There will always be somebody with a story or strategy that's newer or seems much better."

Morningstar video: Bad Timing Costs Investors 2.5% Per Year

Mike Piper, editor of The Oblivious Investor: "One of the most important lessons in investing is that there is no “perfect” portfolio, but there are many “perfectly fine” portfolios. Once you are confident that you have a “perfectly fine” portfolio, just stick with the plan and let the portfolio do what it is meant to do."

Bill Schultheis, author of The Coffeehouse Investor: "42% of millionaires of this country make less than one transaction per year in their investments."

Fred Schwed Jr. author of "Where are the Customers' Yachts? "It turns out that I should have just bought them (securities) and thereafter I should have just sat on them like a fat, stupid peasant."

Chandan Sengupta, author of The Only Proven Road to Investment Success: "If you are not going to stick to your chosen investment method through thick and thin, there is almost no chance of your succeeding as an investor."

Dan Solin, financial author and adviser: "Once you understand that monitoring the markets is harmful to your long-term returns, a whole new world of opportunities will await you."

Larry Swedroe, advisor and financial author: "There are lots of people out there who have something to gain by your taking action instead of your adhering to your well-thought-out plan."

Eric Tyson, author of Mutual Funds for Dummies: "Don't trade in and out of funds. Stay invested. Not only does buy-and-hold investing offer better returns, but it's also less work."

Jason Zweig, financial author and Wall Street Journal columnist: "The ultimate benefits of owning stocks accrue only to those who can buy and hold."

More "What Experts Say"

Why Bogleheads stay-the-course

Best wishes.
Taylor

[SocalLiving]

I thought the entire point to the other 2 threads was already to stay calm and follow course in the face of the media/market excitement. Not sure why we need a third.

There is so much talk of panic selling, getting back in later, buying the dips, and market timing, that it is sometimes hard for the rational voices in the "free fall" thread to penetrate. The other two threads are definitely entertaining, but I often get anxious reading the "free fall" thread. I read them because it reminds me what can happen if you don't have an AA you are comfortable with, and makes me grateful I have an IPS.

During the December 2018 "dip" I remember getting the impression that the boglehead philosophy gets thrown to the wind for a lot of people here the minute there is volatility in the market. This thread might allow new investors to be reassured that a lot of the people on this forum are sticking to their investment plan and not making it up on the fly reacting to the market.

It might be a good way to focus new investors on how the boglehead philosophy is supposed to work during volatile times.

[Ramjet]

I can see a retiree having some angst over this, everyone else...meh

[abuss368]

Stay the course and tune out the market noise. Interesting how CNBC had "Markets in Crisis" on the screen today.

[abuss368]

I can see a retiree having some angst over this, everyone else...meh

Maybe and maybe not. My folks are retired and this has not phased them. Their asset allocation has what they need in bonds.

[HobbesMB]

I have recently retired (1 month ago) so no longer accumulate any funds (just spending the money ), so I am watching all this turmoil with interest as it is a "first" for me.

Looks like you'll need to change that user name.

[Ramjet]

I can see a retiree having some angst over this, everyone else...meh

Maybe and maybe not. My folks are retired and this has not phased them. Their asset allocation has what they need in bonds.

Agree, I just doubt most retirees have the proper asset allocation. Not talking Bogleheads

[Hockey10]

Someone told me the stock market went down 1000 points. They didn't say Dow points or S&P points! Hilarious.

I always tell people to ignore the Dow point change and focus on the % change in the S&P 500. Better yet, don't even pay attention to the change on a daily basis.

[abuss368]

I can see a retiree having some angst over this, everyone else...meh

Maybe and maybe not. My folks are retired and this has not phased them. Their asset allocation has what they need in bonds.

Agree, I just doubt most retirees have the proper asset allocation. Not talking Bogleheads

Sad and unfortunately that is probably true.

[getthatmarshmallow]

I thought the entire point to the other 2 threads was already to stay calm and follow course in the face of the media/market excitement. Not sure why we need a third.

There is so much talk of panic selling, getting back in later, buying the dips, and market timing, that it is sometimes hard for the rational voices in the "free fall" thread to penetrate. The other two threads are definitely entertaining, but I often get anxious reading the "free fall" thread. I read them because it reminds me what can happen if you don't have an AA you are comfortable with, and makes me grateful I have an IPS.

During the December 2018 "dip" I remember getting the impression that the boglehead philosophy gets thrown to the wind for a lot of people here the minute there is volatility in the market. This thread might allow new investors to be reassured that a lot of the people on this forum are sticking to their investment plan and not making it up on the fly reacting to the market.

It might be a good way to focus new investors on how the boglehead philosophy is supposed to work during volatile times.

+1. I was relatively new to taking charge of my retirement in 2018 (instead of target date funds), and the consistent worry I had was whether Bogleheads were really just market timers who pretended they weren't, which meant that their strategy wasn't matching their words, which meant I shouldn't trust their words for guidance.

Anyhow, I DCA three times per month, so I guess this month's final contribution will be at a discount.

[bogledogle87]

This thread is very insightful - because there is nothing really to discuss - which is the point! It exposes our natural desire to want to respond to the market in some way, either with lengthy discussion or mobilizing some kind of action. But the answer is clear - there is not much to discuss, and there is absolutely no need to do anything differently than we already were a week ago.

[TechGuy365]

100/0 and staying the course! I'm a true believer that during accumulation phase downturns like this just enables us to have more buying power with each paycheck contribution!

[Pete12]

Thank you for starting this thread! A great reminder to tune out the short term noise. A while ago I made a Jack Bogle meme and I have it as the wallpaper on my computer... it is helpful to stay focused:

[LittleGreenSoldiers]

This thread is very insightful - because there is nothing really to discuss - which is the point! It exposes our natural desire to want to respond to the market in some way, either with lengthy discussion or mobilizing some kind of action. But the answer is clear - there is not much to discuss, and there is absolutely no need to do anything differently than we already were a week ago.

So what I hear you saying is the only actionable item is to take no action.

[AerialWombat]

deleted

[wolf359]

A Guided Meditation for when the Stock Market is Falling, by JL Collins (Author of "A Simple Path to Wealth")
https://www.youtube.com/watch?v=OOGU94e ... e=youtu.be

[firebirdparts]

Well, the therapy thread is the free fall thread (already). When stocks are soaring you need somebody to talk you out of FOMO but that's not that big of a deal.

[nguy44]

If one has never experienced a market downturn like this, an actionable item is to determine if you are still comfortable with your cash and stock/bond AA for the next market downturn, and start figuring out if you need to adjust.

I have invested through the 1987 Black Monday crash (imagine seeing your equities holdings fall 22% in one day), the recession of 1990, the dot-com bust, and of course the great recession. My lessons learned was to allocate stock/bond/cash to provide me with the proper balance of growth, risk, and "sleep at night" factor to weather the storm. This specifics will not be the same for everyone, but you will find where you are comfortable so that a downturn like this will not be a cause to panic.