U.S. stocks in freefall

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Grt2bOutdoors
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Re: U.S. stocks in freefall

Post by Grt2bOutdoors » Fri Aug 21, 2015 9:15 am

DougA wrote:This is my first market correction since I started running my own money. I went into this thinking that the two key points are when you buy and when you sell. Sure, there's lots of information in between those two points in time, but you haven't made nor lost a single penny until you sell. Of course, buying is an important point too. So, buy low, sell high. Today sucks if you have to sell. I don't. I didn't make any money before this month because I didn't sell. I haven't lost any money this month because I didn't sell.


Today, may be a great day to tax loss harvest. Never look a gift horse in the mouth.
"One should invest based on their need, ability and willingness to take risk - Larry Swedroe" Asking Portfolio Questions

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backpacker
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Re: U.S. stocks in freefall

Post by backpacker » Fri Aug 21, 2015 9:20 am

*yawn*

I'm going to take a nap. Wake me up when something interesting happens. :happy

broadstone
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Re: U.S. stocks in freefall

Post by broadstone » Fri Aug 21, 2015 9:23 am

DougA wrote:
Today, may be a great day to tax loss harvest. Never look a gift horse in the mouth.


What the heck is Tax Loss Harvesting?

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Re: U.S. stocks in freefall

Post by broadstone » Fri Aug 21, 2015 9:29 am

HomerJ wrote:These "buying opportunities" some are getting so excited about are likely to amount to next to nothing 10 years from now. But hey, if it makes some feel better, I guess....

You don't have to get out in order to make money long-term in the market. Trying to beat the market by being out during the bad times, and in during the good times, is very difficult. You have a good chance of doing WORSE than the market when trying to time the market.



Dunno....I'm still feeling pretty good about the decision to switch to 100% cash several weeks ago. :sharebeer

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vitaflo
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Re: U.S. stocks in freefall

Post by vitaflo » Fri Aug 21, 2015 9:32 am

Grt2bOutdoors wrote:
DougA wrote:This is my first market correction since I started running my own money. I went into this thinking that the two key points are when you buy and when you sell. Sure, there's lots of information in between those two points in time, but you haven't made nor lost a single penny until you sell. Of course, buying is an important point too. So, buy low, sell high. Today sucks if you have to sell. I don't. I didn't make any money before this month because I didn't sell. I haven't lost any money this month because I didn't sell.


Today, may be a great day to tax loss harvest. Never look a gift horse in the mouth.


This is what I did. Even was able to get rid of my uncovered shares. Been wanting to do that for a long time.

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greg24
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Re: U.S. stocks in freefall

Post by greg24 » Fri Aug 21, 2015 9:35 am

Stocks on a minor sale. I put in a Roth contribution that will close today.

CantPassAgain
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Re: U.S. stocks in freefall

Post by CantPassAgain » Fri Aug 21, 2015 9:37 am

broadstone wrote:
DougA wrote:
Today, may be a great day to tax loss harvest. Never look a gift horse in the mouth.


What the heck is Tax Loss Harvesting?


https://www.google.com/webhp?sourceid=c ... harvesting

broadstone wrote:
HomerJ wrote:These "buying opportunities" some are getting so excited about are likely to amount to next to nothing 10 years from now. But hey, if it makes some feel better, I guess....

You don't have to get out in order to make money long-term in the market. Trying to beat the market by being out during the bad times, and in during the good times, is very difficult. You have a good chance of doing WORSE than the market when trying to time the market.



Dunno....I'm still feeling pretty good about the decision to switch to 100% cash several weeks ago. :sharebeer


Please let us know when you get back in.

GoldenFinch
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Re: U.S. stocks in freefall

Post by GoldenFinch » Fri Aug 21, 2015 9:41 am

Browser wrote:
nisiprius wrote:Sorry, what are you all seeing? I'm not sure I see it...
Image

From a distance the world looks blue and green
And the snow capped mountains white
From a distance the ocean meets the stream
And the eagle takes to flight
From a distance, there is harmony
And it echoes through the land
It's the voice of hope, it's the voice of peace
It's the voice of every man
From a distance we all have enough
And no one is in need
And there are no guns, no bombs, and no disease
No hungry mouths to feed

Unfortunately, I live on the surface of the earth where things don't always look so rosey.


But if we are only focusing on the markets here, and not other worldly issues, it's healthy (psychologically anyway) to step back and look at the big picture which demonstrates things are not so bad. Also, the big picture is why we say "stay the course."

cottonseed1
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Re: U.S. stocks in freefall

Post by cottonseed1 » Fri Aug 21, 2015 9:45 am

Warren Buffett wrote:Over the 35 years, American business has delivered terrific results. It should therefore have been easy for investors to earn juicy returns: All they had to do was piggyback Corporate America in a diversified, low-expense way. An index fund that they never touched would have done the job. Instead many investors have had experiences ranging from mediocre to disastrous.

There have been three primary causes: first, high costs, usually because investors traded excessively or spent far too much on investment management; second, portfolio decisions based on tips and fads rather than on thoughtful, quantified evaluation of businesses; and third, a start-and-stop approach to the market marked by untimely entries (after an advance has been long underway) and exits (after periods of stagnation or decline). Investors should remember that excitement and expenses are their enemies.


Emphasis mine.

flyingaway
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Re: U.S. stocks in freefall

Post by flyingaway » Fri Aug 21, 2015 9:46 am

Made a bad decision to buy yesterday, maybe I should double down today, (and triple down on Monday?)

CantPassAgain
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Re: U.S. stocks in freefall

Post by CantPassAgain » Fri Aug 21, 2015 9:49 am

flyingaway wrote:Made a bad decision to buy yesterday, maybe I should double down today, (and triple down on Monday?)


Decide on an appropriate allocation for you, set your rebalancing bands "fairly wide," and rebalance when they break.

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jabberwockOG
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Re: U.S. stocks in freefall

Post by jabberwockOG » Fri Aug 21, 2015 9:51 am

I moved some cash I had been accumulating this year to equity yesterday and I am quite satisfied with that decision. Did I hit the perfect bottom?...nope but chasing perfect timing is a fool's errand.

MrVargas
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Re: U.S. stocks in freefall

Post by MrVargas » Fri Aug 21, 2015 9:53 am

I went to Cash a week or so ago in my Roth IRA because I'm moving from Schwab to Vanguard and I figured cash would be easier to move. Not a market timer but feels good to have dodged a few percentage points of losses by accident. I will jump back in once the transfer is complete.

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InvestorNewb
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Re: U.S. stocks in freefall

Post by InvestorNewb » Fri Aug 21, 2015 10:00 am

Why is there a sell off? I haven't seen the market drop this fast... ever. I've only been in for 2 years.

VTI has dropped about $6 this week.
My Portfolio: VTI [US], VXUS [Int'l], VNQ [REIT], VCN [Canada] (largest to smallest)

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greg24
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Re: U.S. stocks in freefall

Post by greg24 » Fri Aug 21, 2015 10:02 am

InvestorNewb wrote:Why is there a sell off?


Animal spirits.

CantPassAgain
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Re: U.S. stocks in freefall

Post by CantPassAgain » Fri Aug 21, 2015 10:03 am

InvestorNewb wrote:Why is there a sell off? I haven't seen the market drop this fast... ever. I've only been in for 2 years.

VTI has dropped about $6 this week.


Where were you Sept 19th to Oct 17th last year?

Browser
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Re: U.S. stocks in freefall

Post by Browser » Fri Aug 21, 2015 10:08 am

First, the bad news is that the DOW is down about 8.6% from it's high in May. :( Now the good news - the DCAers are planning a party to celebrate their recent decision not to lump sum. :D
We don't know where we are, or where we're going -- but we're making good time.

livesoft
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Re: U.S. stocks in freefall

Post by livesoft » Fri Aug 21, 2015 10:10 am

InvestorNewb wrote:Why is there a sell off? I haven't seen the market drop this fast... ever. I've only been in for 2 years.

VTI has dropped about $6 this week.

In the absence of good news, the market goes down. That means with bad news, the market goes down and it also means that with no news, the market goes down.

The market also hates uncertainty. Right now the results of the September FOMC meeting is the big uncertainty. Maybe folks can point to some good news that is to be expected before then, but without something positive to look forward to, then see my first sentence of this post.
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scone
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Re: U.S. stocks in freefall

Post by scone » Fri Aug 21, 2015 10:13 am

I wanna see Jesse Felder shave his beard! :twisted:

http://thefelderreport.com/blog/
"My bond allocation is the amount of money that I cannot afford to lose." -- Taylor Larimore

Browser
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Re: U.S. stocks in freefall

Post by Browser » Fri Aug 21, 2015 10:15 am

livesoft wrote:
InvestorNewb wrote:Why is there a sell off? I haven't seen the market drop this fast... ever. I've only been in for 2 years.

VTI has dropped about $6 this week.

In the absence of good news, the market goes down. That means with bad news, the market goes down and it also means that with no news, the market goes down.

The market also hates uncertainty. Right now the results of the September FOMC meeting is the big uncertainty. Maybe folks can point to some good news that is to be expected before then, but without something positive to look forward to, then see my first sentence of this post.

I don't think people are aware the market has been gradually selling off since the middle of May, which is 3+ months and counting. So far at least "sell in May and go away" would have been a good idea.
We don't know where we are, or where we're going -- but we're making good time.

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Re: U.S. stocks in freefall

Post by Browser » Fri Aug 21, 2015 10:19 am

Down almost 300 on the DOW today on top of the 300+ loss yesterday. Is this getting anybody's attention yet? This guy nailed it to the day:

http://www.marketwatch.com/story/market-timer-tom-mcclellan-sees-stocks-set-up-for-ugly-decline-as-early-as-thursday-2015-08-17?dist=lcountdown
We don't know where we are, or where we're going -- but we're making good time.

Hunky-dory
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Re: U.S. stocks in freefall

Post by Hunky-dory » Fri Aug 21, 2015 10:21 am

Interesting day. My guess is the sell off intensifies at some point this afternoon. Grab some popcorn!

Browser
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Re: U.S. stocks in freefall

Post by Browser » Fri Aug 21, 2015 10:25 am

I'm happy -- I've been keeping my beak dry for a long time waiting for a nice drink. Now comes the problem of when to grab for the falling knife. :confused :confused
We don't know where we are, or where we're going -- but we're making good time.

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backpacker
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Re: U.S. stocks in freefall

Post by backpacker » Fri Aug 21, 2015 10:38 am

Browser wrote:Down almost 300 on the DOW today on top of the 300+ loss yesterday. Is this getting anybody's attention yet? This guy nailed it to the day:

http://www.marketwatch.com/story/market-timer-tom-mcclellan-sees-stocks-set-up-for-ugly-decline-as-early-as-thursday-2015-08-17?dist=lcountdown


Even broken clocks are right twice a day. :beer

Browser
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Re: U.S. stocks in freefall

Post by Browser » Fri Aug 21, 2015 10:41 am

backpacker wrote:
Browser wrote:Down almost 300 on the DOW today on top of the 300+ loss yesterday. Is this getting anybody's attention yet? This guy nailed it to the day:

http://www.marketwatch.com/story/market-timer-tom-mcclellan-sees-stocks-set-up-for-ugly-decline-as-early-as-thursday-2015-08-17?dist=lcountdown


Even broken clocks are right twice a day. :beer

Yeh, Isn't that creepy though? I'm never right. Maybe I need to buy a broken clock....
We don't know where we are, or where we're going -- but we're making good time.

easye418
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Re: U.S. stocks in freefall

Post by easye418 » Fri Aug 21, 2015 10:42 am

So I have a lazy 3 fund.... 80/20. Would I be advised to sell my 20% bonds and buy stocks at this level?

Bacchus01
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Re: U.S. stocks in freefall

Post by Bacchus01 » Fri Aug 21, 2015 10:48 am

Today was definitely a TLH day. If you haven't looked and done it, you probably should.

Interesting to note that I transfered (swapped) all of my VTIAX purchases going back to 12/28/2012. Ouch. I moved all of my VTSAX going back to 12/27/2013. I will likely still swap my VMVAX that were bought in Jan 2015.

Not much growth happening.

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Munir
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Re: U.S. stocks in freefall

Post by Munir » Fri Aug 21, 2015 10:49 am

Thank God I'm in 50% bonds and 10% cash. But as a retiree in my late seventies, this still hurts.

easye418
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Re: U.S. stocks in freefall

Post by easye418 » Fri Aug 21, 2015 10:52 am

Bacchus01 wrote:Today was definitely a TLH day. If you haven't looked and done it, you probably should.

Interesting to note that I transfered (swapped) all of my VTIAX purchases going back to 12/28/2012. Ouch. I moved all of my VTSAX going back to 12/27/2013. I will likely still swap my VMVAX that were bought in Jan 2015.

Not much growth happening.


TLH stands for?

Bacchus01
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Re: U.S. stocks in freefall

Post by Bacchus01 » Fri Aug 21, 2015 10:53 am

easye418 wrote:
Bacchus01 wrote:Today was definitely a TLH day. If you haven't looked and done it, you probably should.

Interesting to note that I transfered (swapped) all of my VTIAX purchases going back to 12/28/2012. Ouch. I moved all of my VTSAX going back to 12/27/2013. I will likely still swap my VMVAX that were bought in Jan 2015.

Not much growth happening.


TLH stands for?

Tax Loss Harvest.

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Re: U.S. stocks in freefall

Post by sschullo » Fri Aug 21, 2015 10:53 am

greg24 wrote:
InvestorNewb wrote:Why is there a sell off?


Animal spirits.


Markets have this habit of being unpredictable. Markets go up and down and we don't why or when. Oh, the talking heads provide hints that we can discuss, but I would rather go to the gym, talk with my hubby about going to our next movie, read a book or go on a hike in our local mountains. Life is good.
Public School K-12 Educators: "Ask NOT what your annuity sales person can do for you, ask what you can do to be a Do-It-Yourselfer (DIY)."

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Garco
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Re: U.S. stocks in freefall

Post by Garco » Fri Aug 21, 2015 10:58 am

I'm also standing pat. My AA was reasonable 10 years ago, 5 years ago, a year ago, 6 months ago, and it's still reasonable today. As the old saying goes, only two things are certain about the stock market: stocks go up and stocks go down. I set aside a sizable amount of cash (into cash-like investments) a year ago in anticipation of a major purchase. That cash is still there (and then some) today.

asif408
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Re: U.S. stocks in freefall

Post by asif408 » Fri Aug 21, 2015 11:07 am

This is my first go round of a dip paying attention to the market, and it's nice to see my bond funds doing their job.

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Uncle Pennybags
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Re: U.S. stocks in freefall

Post by Uncle Pennybags » Fri Aug 21, 2015 11:07 am

DougA wrote: I didn't make any money before this month because I didn't sell. I haven't lost any money this month because I didn't sell.
I don't sell but do get dividends and interest. The real hurt comes when I have to pay tax on those wile my numbers are red.

I still have one unit to invest this month. I like to dollar cost average in over a month by buying the security that is down. So many choices. I think I'm going to let foreign stock fall to 10% of my stock holdings before I buy any more. Trying to keep it at 20% hurts too much.

Grt2bOutdoors wrote:Today, may be a great day to tax loss harvest.
If I did that the market would have its greatest 30 days in its history.

backpacker wrote:I'm going to take a nap. Wake me up when something interesting happens. :happy
The Korean War is starting again. Radar is picking up Korean ICBMs headed this way so I wouldn't sweat the market.

broadstone wrote:What the heck is Tax Loss Harvesting?
Buying high and selling low.

broadstone wrote:Dunno....I'm still feeling pretty good about the decision to switch to 100% cash several weeks ago. :sharebeer
Make sure you tell us when to get back in. We want to get rich too.

flyingaway wrote:Made a bad decision to buy yesterday, maybe I should double down today, (and triple down on Monday?)
You can do that with stocks. A casino has a limit on bet size.

InvestorNewb wrote:Why is there a sell off? I haven't seen the market drop this fast... ever. I've only been in for 2 years.
The market was overdue for a "correction" of 10%. Don't do anything just stand there.

greg24 wrote:
InvestorNewb wrote:Why is there a sell off?

Animal spirits.
Image

CantPassAgain wrote:Where were you Sept 19th to Oct 17th last year?
I was crying worried about Bentley the dog getting Ebola.

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greg24
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Re: U.S. stocks in freefall

Post by greg24 » Fri Aug 21, 2015 11:15 am

easye418 wrote:So I have a lazy 3 fund.... 80/20. Would I be advised to sell my 20% bonds and buy stocks at this level?


No. But you may want to rebalance if you are out of your rebalancing bands.

oc4boxer
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Re: U.S. stocks in freefall

Post by oc4boxer » Fri Aug 21, 2015 11:17 am

I was going to look at my 401k this morning and stopped myself. That's just what they want me to do...

easye418
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Re: U.S. stocks in freefall

Post by easye418 » Fri Aug 21, 2015 11:17 am

greg24 wrote:
easye418 wrote:So I have a lazy 3 fund.... 80/20. Would I be advised to sell my 20% bonds and buy stocks at this level?


No. But you may want to rebalance if you are out of your rebalancing bands.


I am 26. I thought 20% bonds was a bit heavy. This just gives me a buying opportunity to move it to even heavier stocks for a while.

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Minsc
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Re: U.S. stocks in freefall

Post by Minsc » Fri Aug 21, 2015 11:40 am

I started my taxable account in March of this year, do you need to wait a year to TLH? It is 100% VTIAX

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Re: U.S. stocks in freefall

Post by jebmke » Fri Aug 21, 2015 11:44 am

Minsc wrote:I started my taxable account in March of this year, do you need to wait a year to TLH? It is 100% VTIAX

No need to wait. TLH when you have losses. In fact, short term losses are better than long term losses.

Make sure you TLH to something you would be comfortable with holding for the long term in case you hit bottom and the new position starts to create unrealized gains.

If the market falls again after you TLH, look for a chance to TLH again back to your original holding.

Rinse and repeat. During the 2008/09 downtick I made more than one round trip. I still have losses from that cycle.
When you discover that you are riding a dead horse, the best strategy is to dismount.

broadstone
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Re: U.S. stocks in freefall

Post by broadstone » Fri Aug 21, 2015 12:02 pm

Shame it's Friday. This lovely correction could have kept going.

It was only a matter of time the USA's massive debt sunk the stock market. Add China and you have a potent financial bomb waiting to explode. As I said a couple of weeks ago, this will be a once in a decade buying op so dig up your cash people.

jpdion
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Re: U.S. stocks in freefall

Post by jpdion » Fri Aug 21, 2015 12:15 pm

Retired end of January 2015 . . . but haven't had to touch IRA $ . . . Wife, still working, moving big chunk with 59 1/2 rollover from 401(k) S&P index fund (converted to cash last week) to Vanguard Retirement 2020 balanced fund . . . check in mail to Vanguard . . . couldn't be happier with the pure serenDIPity! Stayed the course in the great recession . . . can do so now with 2 years of cash set aside if I needed to draw funds. Time to take dip in the pool!

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Re: U.S. stocks in freefall

Post by Sbashore » Fri Aug 21, 2015 12:22 pm

broadstone wrote:
HomerJ wrote:These "buying opportunities" some are getting so excited about are likely to amount to next to nothing 10 years from now. But hey, if it makes some feel better, I guess....

You don't have to get out in order to make money long-term in the market. Trying to beat the market by being out during the bad times, and in during the good times, is very difficult. You have a good chance of doing WORSE than the market when trying to time the market.



Dunno....I'm still feeling pretty good about the decision to switch to 100% cash several weeks ago. :sharebeer


Give it time. :D
Steve | Semper Fi

wxz76
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Re: U.S. stocks in freefall

Post by wxz76 » Fri Aug 21, 2015 12:23 pm

jebmke wrote:No need to wait. TLH when you have losses. In fact, short term losses are better than long term losses.


Why would short term losses better than long term? Thanks.

IlliniDave
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Re: U.S. stocks in freefall

Post by IlliniDave » Fri Aug 21, 2015 12:25 pm

Weeks like this are what we get paid over the long haul to endure.
Don't do something. Just stand there!

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Re: U.S. stocks in freefall

Post by minesweep » Fri Aug 21, 2015 12:26 pm

investingdad wrote:I love this thread...it's like Groundhog Day.

Global woes are casting a shadow over the stock market.

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Re: U.S. stocks in freefall

Post by surfstar » Fri Aug 21, 2015 12:32 pm

I predict a 1.5% gain on Monday.

If true, my newsletter subscription will start Tuesday. :D

goingup
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Re: U.S. stocks in freefall

Post by goingup » Fri Aug 21, 2015 12:36 pm

Bacchus01 wrote:Today was definitely a TLH day. If you haven't looked and done it, you probably should.

Interesting to note that I transfered (swapped) all of my VTIAX purchases going back to 12/28/2012. Ouch. I moved all of my VTSAX going back to 12/27/2013. I will likely still swap my VMVAX that were bought in Jan 2015.

Not much growth happening.

Wait. What? Surely you have considerable gains on VTIAX purchased in 2012 and VTSAX purchased in 2013. What's the TLH opportunity there?

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Re: U.S. stocks in freefall

Post by oldzey » Fri Aug 21, 2015 12:40 pm

Image
"The broker said the stock was 'poised to move.' Silly me, I thought he meant up." ― Randy Thurman

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BeerMoney
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Re: U.S. stocks in freefall

Post by BeerMoney » Fri Aug 21, 2015 12:42 pm


chipmonk
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Re: U.S. stocks in freefall

Post by chipmonk » Fri Aug 21, 2015 12:51 pm

wxz76 wrote:
jebmke wrote:No need to wait. TLH when you have losses. In fact, short term losses are better than long term losses.


Why would short term losses better than long term? Thanks.


If you're selling your entire position in some fund at a loss, it makes no difference. However, if you're only selling part of your holdings it makes a difference:

Selling a tax lot at a loss for short-term loss and holding a tax lot with unrealized long-term gains

... is better than ...

Selling a tax lot at a loss for long-term loss and holding a tax lot with unrealized short-term gains

... because in the former situation, you're left holding a lot with unrealized long-term capital gains (lower tax rate), while in the latter situation, you're left holding a lot with unrealized short-term capital gains.

The former situation is better because it gives you more future flexibility. You've already held the tax lot which you're holding long enough that it will count as long-term gains if/when you sell it.

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