move to BND ?

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trishna99
Posts: 44
Joined: Thu Nov 21, 2013 10:25 am

move to BND ?

Post by trishna99 »

Hello, Im getting nervous like everyone and plan on keeping the course. I have a moderate allocation advisor portfolio.
Next appointment is Mar 9.....I would really like some advise now with this market turn down. My IRA'sa re mostly Bond funds and an annuity that is 50/50.
The question is on my brokerage account with 50/50 stock/bond funds. I will keep all where is ....
But Im considering moving out of the EXTENDED MARKET fund VEX ( which has dropped the most ) into
the BND fund which isn't dropping.???
Any thoughts on this would be appreciated!
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Steve Reading
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Re: move to BND ?

Post by Steve Reading »

trishna99 wrote: Fri Feb 28, 2020 11:45 am Hello, Im getting nervous like everyone
The market has dropped to the price it was a few months ago. Were you nervous when VEXAX was at 86 in Oct 2019? If not, why are you nervous that it’s at 88 now? If VEXAX has simply stayed at 86-88 for these past 5 months, would you then want to sell now? Probably not. You’re only nervous because it used to be higher and now lower. This is pure human anchoring bias.

Also who is nervous exactly? Us BHs are staying the course. It’s only a few that panic and sell after a mere correction that are opening threads left and right, creating the loudest noise.
"... so high a present discounted value of wealth, it is only prudent for him to put more into common stocks compared to his present tangible wealth, borrowing if necessary" - Paul Samuelson
Jack FFR1846
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Re: move to BND ?

Post by Jack FFR1846 »

Your proposal is opposite what would be advisable, if you must do something.

Sell ext mkt, which has dropped low to buy BND which has risen quite a bit. So....sell low and buy high.

If you were to ask about selling BND to buy ext (or any stock), in a rebalance exercise, I couldn't complain at all about doing that.
Bogle: Smart Beta is stupid
Broken Man 1999
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Re: move to BND ?

Post by Broken Man 1999 »

I wouldn't sell stocks, which are certainly lower in price over the last few days, to buy bonds, which are certainly higher in price over the last few days.

Selling low and buying high isn't a strategy I would want to use.

Can you dump your advisor? That would be an easy way to keep more $$ for yourself.

If you post specifics about your investments, there are lots of very smart people here who are very willing to offer excellent advice.

Broken Man 1999
“If I cannot drink Bourbon and smoke cigars in Heaven then I shall not go. " -Mark Twain
Silk McCue
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Re: move to BND ?

Post by Silk McCue »

But Im considering moving out of the EXTENDED MARKET fund VEX ( which has dropped the most ) into
the BND fund which isn't dropping.???
Only if you want ignore everything you have ever learned here and instead want to lock in a loss.

Stop watching the market. Ignore the scared voice in your head.

Cheers
carminered2019
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Re: move to BND ?

Post by carminered2019 »

Were you nervous or cheering November 2019 because we are at the same level.
z3r0c00l
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Re: move to BND ?

Post by z3r0c00l »

BND and similar funds have essentially never been more expensive than the EOD today. Interest rates are exceptionally low. Rates may keep dropping, but make no mistake I think if any timing is to be done, it is to sell bond funds and put that money in stocks. 5-7 year duration bond funds are now paying less than a 12 month CD, if you think that is a fair offer then by all means back up the truck.
Topic Author
trishna99
Posts: 44
Joined: Thu Nov 21, 2013 10:25 am

Re: move to BND ?

Post by trishna99 »

question was on VXF extended market fund.
rudeboy
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Re: move to BND ?

Post by rudeboy »

305pelusa wrote: Fri Feb 28, 2020 11:52 am
trishna99 wrote: Fri Feb 28, 2020 11:45 am Hello, Im getting nervous like everyone
The market has dropped to the price it was a few months ago. Were you nervous when VEXAX was at 86 in Oct 2019? If not, why are you nervous that it’s at 88 now? If VEXAX has simply stayed at 86-88 for these past 5 months, would you then want to sell now? Probably not. You’re only nervous because it used to be higher and now lower. This is pure human anchoring bias.

Also who is nervous exactly? Us BHs are staying the course. It’s only a few that panic and sell after a mere correction that are opening threads left and right, creating the loudest noise.
I think reasoning such as Were you nervous when VEXAX was at 86 in Oct 2019? If not, why are you nervous that it’s at 88 now? is silly. He's nervous about the potential for a global pandemic. I don't see what's so hard to understand about that. The point of the Boglehead philosophy is to stay the course despite your emotions, not to act like you don't have emotions.
Topic Author
trishna99
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Joined: Thu Nov 21, 2013 10:25 am

Re: move to BND ?

Post by trishna99 »

Thank-you all for answering my question and yr good advise !! Your suggestions and response has helped me make more sense in this downturn!

THANK-YOU !!!!!!!!
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Steve Reading
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Re: move to BND ?

Post by Steve Reading »

rudeboy wrote: Fri Feb 28, 2020 12:05 pm
305pelusa wrote: Fri Feb 28, 2020 11:52 am
trishna99 wrote: Fri Feb 28, 2020 11:45 am Hello, Im getting nervous like everyone
The market has dropped to the price it was a few months ago. Were you nervous when VEXAX was at 86 in Oct 2019? If not, why are you nervous that it’s at 88 now? If VEXAX has simply stayed at 86-88 for these past 5 months, would you then want to sell now? Probably not. You’re only nervous because it used to be higher and now lower. This is pure human anchoring bias.

Also who is nervous exactly? Us BHs are staying the course. It’s only a few that panic and sell after a mere correction that are opening threads left and right, creating the loudest noise.
I think reasoning such as Were you nervous when VEXAX was at 86 in Oct 2019? If not, why are you nervous that it’s at 88 now? is silly. He's nervous about the potential for a global pandemic. I don't see what's so hard to understand about that.

The price in Oct was at 88 because there were also many challenges to the economy. Remember the global trade war? We didn’t even have a Phase 1 back then. The price was similar then to now because the trade war was potentially similarly damaging to future earnings as this virus (at least to the extent you believe the price was efficient). So why didn’t he sell in October but wants to now?

Could it be that stocks just shed 15%+ in a week ? Apply Ockham’s razor here bud.
"... so high a present discounted value of wealth, it is only prudent for him to put more into common stocks compared to his present tangible wealth, borrowing if necessary" - Paul Samuelson
rudeboy
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Re: move to BND ?

Post by rudeboy »

305pelusa wrote: Fri Feb 28, 2020 12:59 pm
rudeboy wrote: Fri Feb 28, 2020 12:05 pm
305pelusa wrote: Fri Feb 28, 2020 11:52 am
trishna99 wrote: Fri Feb 28, 2020 11:45 am Hello, Im getting nervous like everyone
The market has dropped to the price it was a few months ago. Were you nervous when VEXAX was at 86 in Oct 2019? If not, why are you nervous that it’s at 88 now? If VEXAX has simply stayed at 86-88 for these past 5 months, would you then want to sell now? Probably not. You’re only nervous because it used to be higher and now lower. This is pure human anchoring bias.

Also who is nervous exactly? Us BHs are staying the course. It’s only a few that panic and sell after a mere correction that are opening threads left and right, creating the loudest noise.
I think reasoning such as Were you nervous when VEXAX was at 86 in Oct 2019? If not, why are you nervous that it’s at 88 now? is silly. He's nervous about the potential for a global pandemic. I don't see what's so hard to understand about that.

The price in Oct was at 88 because there were also many challenges to the economy. Remember the global trade war? We didn’t even have a Phase 1 back then. The price was similar then to now because the trade war was potentially similarly damaging to future earnings as this virus (at least to the extent you believe the price was efficient). So why didn’t he sell in October but wants to now?

Could it be that stocks just shed 15%+ in a week ? Apply Ockham’s razor here bud.
You're missing my point, which is that there is a perfectly reasonable explanation as to why the OP expressed nervousness (and October is completely irrelevant to it). Being good Bogleheads, we know not to act on our emotions when it comes to investing. But to question why someone feels emotions is something else entirely.
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sometimesinvestor
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Re: move to BND ?

Post by sometimesinvestor »

At current levels capital gains in bonds will probably be non existent. Better to buy stocks paying good dividends with strong balance sheets(i.e they won't go out of business no matter how bad things get) like exxon(XOM) or AT+T (T)
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Orbuculum Nongata
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Re: move to BND ?

Post by Orbuculum Nongata »

trishna99 wrote: Fri Feb 28, 2020 11:45 am Hello, Im getting nervous like everyone and plan on keeping the course. I have a moderate allocation advisor portfolio.
Next appointment is Mar 9.....I would really like some advise now with this market turn down. My IRA'sa re mostly Bond funds and an annuity that is 50/50.
The question is on my brokerage account with 50/50 stock/bond funds. I will keep all where is ....
But Im considering moving out of the EXTENDED MARKET fund VEX ( which has dropped the most ) into
the BND fund which isn't dropping.???
Any thoughts on this would be appreciated!
Hello trishna99. If you want to get into the business of market timing may I suggest you entertain the idea of buying low and selling high? If, on the other hand you think your allocation is reasonable despite any market conditions may I suggest that you don’t do anything out of being “nervous”?

PS, not everyone is getting nervous. Lots of us don’t pay attention to the “Breaking” news.
Potential - distraction = performance.
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Steve Reading
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Re: move to BND ?

Post by Steve Reading »

rudeboy wrote: Fri Feb 28, 2020 1:09 pm
305pelusa wrote: Fri Feb 28, 2020 12:59 pm
rudeboy wrote: Fri Feb 28, 2020 12:05 pm
305pelusa wrote: Fri Feb 28, 2020 11:52 am
trishna99 wrote: Fri Feb 28, 2020 11:45 am Hello, Im getting nervous like everyone
The market has dropped to the price it was a few months ago. Were you nervous when VEXAX was at 86 in Oct 2019? If not, why are you nervous that it’s at 88 now? If VEXAX has simply stayed at 86-88 for these past 5 months, would you then want to sell now? Probably not. You’re only nervous because it used to be higher and now lower. This is pure human anchoring bias.

Also who is nervous exactly? Us BHs are staying the course. It’s only a few that panic and sell after a mere correction that are opening threads left and right, creating the loudest noise.
I think reasoning such as Were you nervous when VEXAX was at 86 in Oct 2019? If not, why are you nervous that it’s at 88 now? is silly. He's nervous about the potential for a global pandemic. I don't see what's so hard to understand about that.

The price in Oct was at 88 because there were also many challenges to the economy. Remember the global trade war? We didn’t even have a Phase 1 back then. The price was similar then to now because the trade war was potentially similarly damaging to future earnings as this virus (at least to the extent you believe the price was efficient). So why didn’t he sell in October but wants to now?

Could it be that stocks just shed 15%+ in a week ? Apply Ockham’s razor here bud.
You're missing my point, which is that there is a perfectly reasonable explanation as to why the OP expressed nervousness (and October is completely irrelevant to it). Being good Bogleheads, we know not to act on our emotions when it comes to investing. But to question why someone feels emotions is something else entirely.
Nah don’t twist my words. I think it’s perfectly reasonable to be nervous. What is inconsistent is to be nervous now but not have been nervous back in Oct. October is completely relevant because a rational human would be either nervous on both or on neither. The market was arguably similarly risky then and now. It’s just that now appears riskier due to the preceding drop. If you were nervous on one (say now) but not in Oct, you know there are human emotions and biases at play (the anchoring bias). Recognizing them will help you stay the course.
"... so high a present discounted value of wealth, it is only prudent for him to put more into common stocks compared to his present tangible wealth, borrowing if necessary" - Paul Samuelson
rudeboy
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Re: move to BND ?

Post by rudeboy »

305pelusa wrote: Fri Feb 28, 2020 2:21 pm
rudeboy wrote: Fri Feb 28, 2020 1:09 pm
305pelusa wrote: Fri Feb 28, 2020 12:59 pm
rudeboy wrote: Fri Feb 28, 2020 12:05 pm
305pelusa wrote: Fri Feb 28, 2020 11:52 am

The market has dropped to the price it was a few months ago. Were you nervous when VEXAX was at 86 in Oct 2019? If not, why are you nervous that it’s at 88 now? If VEXAX has simply stayed at 86-88 for these past 5 months, would you then want to sell now? Probably not. You’re only nervous because it used to be higher and now lower. This is pure human anchoring bias.

Also who is nervous exactly? Us BHs are staying the course. It’s only a few that panic and sell after a mere correction that are opening threads left and right, creating the loudest noise.
I think reasoning such as Were you nervous when VEXAX was at 86 in Oct 2019? If not, why are you nervous that it’s at 88 now? is silly. He's nervous about the potential for a global pandemic. I don't see what's so hard to understand about that.

The price in Oct was at 88 because there were also many challenges to the economy. Remember the global trade war? We didn’t even have a Phase 1 back then. The price was similar then to now because the trade war was potentially similarly damaging to future earnings as this virus (at least to the extent you believe the price was efficient). So why didn’t he sell in October but wants to now?

Could it be that stocks just shed 15%+ in a week ? Apply Ockham’s razor here bud.
You're missing my point, which is that there is a perfectly reasonable explanation as to why the OP expressed nervousness (and October is completely irrelevant to it). Being good Bogleheads, we know not to act on our emotions when it comes to investing. But to question why someone feels emotions is something else entirely.
Nah don’t twist my words. I think it’s perfectly reasonable to be nervous. What is inconsistent is to be nervous now but not have been nervous back in Oct. October is completely relevant because a rational human would be either nervous on both or on neither. The market was arguably similarly risky then and now. It’s just that now appears riskier due to the preceding drop. If you were nervous on one (say now) but not in Oct, you know there are human emotions and biases at play (the anchoring bias). Recognizing them will help you stay the course.
You literally said "why are you nervous...?" to the OP. You don't get to decide when someone else should be nervous.

Anyway, we can agree to disagree (or not). I'm respectfully bowing out.
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Steve Reading
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Re: move to BND ?

Post by Steve Reading »

rudeboy wrote: Fri Feb 28, 2020 3:03 pm
305pelusa wrote: Fri Feb 28, 2020 2:21 pm
rudeboy wrote: Fri Feb 28, 2020 1:09 pm
305pelusa wrote: Fri Feb 28, 2020 12:59 pm
rudeboy wrote: Fri Feb 28, 2020 12:05 pm

I think reasoning such as Were you nervous when VEXAX was at 86 in Oct 2019? If not, why are you nervous that it’s at 88 now? is silly. He's nervous about the potential for a global pandemic. I don't see what's so hard to understand about that.

The price in Oct was at 88 because there were also many challenges to the economy. Remember the global trade war? We didn’t even have a Phase 1 back then. The price was similar then to now because the trade war was potentially similarly damaging to future earnings as this virus (at least to the extent you believe the price was efficient). So why didn’t he sell in October but wants to now?

Could it be that stocks just shed 15%+ in a week ? Apply Ockham’s razor here bud.
You're missing my point, which is that there is a perfectly reasonable explanation as to why the OP expressed nervousness (and October is completely irrelevant to it). Being good Bogleheads, we know not to act on our emotions when it comes to investing. But to question why someone feels emotions is something else entirely.
Nah don’t twist my words. I think it’s perfectly reasonable to be nervous. What is inconsistent is to be nervous now but not have been nervous back in Oct. October is completely relevant because a rational human would be either nervous on both or on neither. The market was arguably similarly risky then and now. It’s just that now appears riskier due to the preceding drop. If you were nervous on one (say now) but not in Oct, you know there are human emotions and biases at play (the anchoring bias). Recognizing them will help you stay the course.
You literally said "why are you nervous...?" to the OP. You don't get to decide when someone else should be nervous.

Anyway, we can agree to disagree (or not). I'm respectfully bowing out.
Yes, I said that immediately after asking if they were also nervous in Oct. My questions make sense in the context of the response; you don’t get to pull a phrase and attack that specifically. If their answer was “yes I was nervous then and I’m nervous now”, that’s fine. It’s consistent and makes sense. If their answer isn’t that (“I wasn’t nervous in Oct but am nervous now”), and I suspect that’s the case, then I hope they can appreciate some of the inconsistency.

I hope this makes sense to you now.
"... so high a present discounted value of wealth, it is only prudent for him to put more into common stocks compared to his present tangible wealth, borrowing if necessary" - Paul Samuelson
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