Time to lighten up on growth?

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Stanczyk
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Time to lighten up on growth?

Post by Stanczyk »

This is not a Boglehead-type of a quesiton. I guess I am 50% Boglehead :)

Those of you who are not completely in total market indexes, did you\are you planning to sell some of your growth equities? The reason for this question is that we may see some inflation going forward. Of course we don't know if we will have inflation, but the fear of inflation is definitely real, which is why growth equities have been underpinning.

Honestly, some of my growth investments (like ARK funds) have done so well last year, that I am contemplating taking profit and investing in the market or something like PAVE.
bloom2708
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Re: Time to lighten up on growth?

Post by bloom2708 »

If growth gets clobbered, what will happen to value? Or if US gets clobbered, what will happen to international?

I don't see them being un-attached.

If you are saying to add more fixed income and sell some ARK, we'll I could see that. Going from 100-0 to 90-10 for example. Due to increases in portfolio value and age getting higher.

Tough choices.
Last edited by bloom2708 on Mon May 03, 2021 12:27 pm, edited 1 time in total.
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jay22
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Re: Time to lighten up on growth?

Post by jay22 »

Depends on what "growth" funds you are looking at - ARK funds will most certainly not perform as well as they did in 2020. Funds with heavy exposure to big tech stocks will continue to do well since they are quite fairly valued.
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David Jay
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Re: Time to lighten up on growth?

Post by David Jay »

What does your IPS say? I presume your IPS includes a rebalancing plan to move assets out of classes that have overperformed and reposition them in classes that have underperformed on a scheduled basis.
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Astones
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Re: Time to lighten up on growth?

Post by Astones »

With the reopening approaching it sounds like a good moment to sell an ETF that has Zoom in its top holdings.
That said, I'm biased, I would have never bought ARK in the first place.
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Stanczyk
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Re: Time to lighten up on growth?

Post by Stanczyk »

Astones wrote: Mon May 03, 2021 12:30 pm With the reopening approaching it sounds like a good moment to sell an ETF that has Zoom in its top holdings.
That said, I'm biased, I would have never bought ARK in the first place.
Why not?
Astones
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Re: Time to lighten up on growth?

Post by Astones »

Stanczyk wrote: Mon May 03, 2021 12:33 pm Why not?
I'm not a fan of hyped stocks, I'm surely not a fan of active funds, and I'm not a fan of relatively high expense ratios.
I believe that TSLA has been overpriced for quite a while, as many other technology companies.

I don't think ARK will keep outperforming for more than one or two years, but if I had to bet I'd say that it will already underperform this year. We'll see how wrong I am.

Then, it surely doesn't help that Cathie Wood recently created a new "space" ETF, and then it turns out that in the top holdings you find stuff like Netflix. I agree with Cramer that it's a bit odd.

So, overall, I'm totally fine with missing out on this one.
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LadyGeek
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Re: Time to lighten up on growth?

Post by LadyGeek »

The OP has an ongoing ARK discussion here: Ark Funds
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Robot Monster
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Re: Time to lighten up on growth?

Post by Robot Monster »

No idea, but of interest...

Joe Davis, Head of Investment at Vanguard says that with the broad market being modestly overvalued there's a once in a generation opportunity in value stocks.
https://m.youtube.com/watch?v=buQ37Vkk1qk&t=80s

Also, "Market bull Jeremy Siegel warns the Nasdaq rebound will unravel, favors value stocks" published 3-9-21 link
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secondopinion
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Re: Time to lighten up on growth?

Post by secondopinion »

Stanczyk wrote: Mon May 03, 2021 12:18 pm Those of you who are not completely in total market indexes, did you\are you planning to sell some of your growth equities? The reason for this question is that we may see some inflation going forward. Of course we don't know if we will have inflation, but the fear of inflation is definitely real, which is why growth equities have been underpinning.
I try to balance the two of value and growth; so, some growth did get sold to buy value as of last year. Aside from this, I hate to make guess right now as to the fate of growth in the next few years/decades.
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