Thanks appreciate the thought and do my best to abide by your advice.
Thanks appreciate the thought and do my best to abide by your advice.
Ghost of Igloi wrote:
No. You just fall in love with fairy tales. Anything with a dose of reality is negative in your view, until the day comes when your belief system cracks. Who would have known?
You may be the only person here who considers talk of a 9+ year bull market to be "the negative side." Or fairy tales.
You are the one that needs a dose of reality.
Rather obvious don cha tink?
anyone who has fundamentally missed out on this 9-year bull market has lost, in my opinion. It doesn't matter what happens from here (even if it does drop, which is unknown). A drop still allows an investor to sell and take profits, and to buy at lower, more favorable valuations.
That is reality. That has already happened, That is unrealized gains and profits. That is already gone and cannot be gotten back.
What happens in the future is not the least bit certain, regardless of what has happened in the past.
I don't think some on here grasp this fundamental point. A major drop is not going to save this historic missed opportunity.
Seattle,
How does that work for the buy and hold investor?
Igy
I can only speak for myself. When i buy a new stock, i'll pretty much cut my losses after about a 5% loss if it was intended as a long term buy. I may buy lower if it drops another few percent from there. In all honesty, lately this has not always worked out as well as i would have liked...
Then, for long term holds, i generally keep a stock but only sell it before it goes negative. If it keeps going up, i generally add to the position, unless we get to the levels like we have had most of the last year, and then i only have bought high fliers right before earnings announcements and have done well on that for the most part. But i will admit that i have not been buying except for the major dips like a few weeks ago.
MUtual fund stuff just sits there unless it underperforms noticably and then i rotate.
Point being, there's always an exit strategy.
Ghost of Igloi wrote:Seattle,
How does that work for the buy and hold investor?
Igy
I realize you were asking a hypothetical question, but I will answer for myself in terms of what I did in the recent downturn. I consider myself a fairly passive investor, and most years I update my portfolio in January, and then readjust once or twice for major changes, or to weed out bad choices. So I think I'm for the most part a "buy and hold" investor.
In this recent "correction" (if that's what it will be viewed as in the fullness of time, I admit I panicked. At the 10% drop point on 9 Feb (my portfolio was down about 6.5%), I sold 2/3 of my portfolio to avoid further losses. Then my plan was to wait a couple/few weeks and sit out the turmoil. As it turns out, I got impatient waiting, lost a bit of opportunity in a couple of bounce back days, and decided to wade back in. Fortunately (at least in the shorter term), in re-entering, I made some different choices (i.e. I didn't buy back exactly what I'd sold off), and the revised portfolio has been doing much better relative to the markets. Instead of being down 6.5% from end-December, I'm only down a hair over 1%. I realize that underperforms US markets, but I'm not American and less than 20% of my portfolio is in US stocks; I'm doing a little better than the index I track most closely (~ 2 % better), which is better than I'd been doing before the correction. Which is of course pure luck.
Personally, I'm hoping volatility dies back to recent levels so I can stop watching the portfolio so closely. I was only peeking once a week before the correction, now I'm way more nervous...
Seattle,
Did you sell any of your new positions when you were down more than 5% a few weeks back? By definition a buy and hold investor would lose any advantage other than dividends.
Igy
one of the more,
Generally that is the experiencd of most investors. Can you imagine what will happen when buy on the dips continuously move lower? Don’t kid yourself it won’t happen and in fact highly likely from here.
Igy
Yes, my average was way below par. I not only sold at a loss, i was buying back at the wrong time, and watched it drop yet further (but wouldn't sell again becuase i was fed up with with being whipsawed) . Once the market bottomed, i started gaining back but still underwater on a couple.
That thing the TD Ameritrade guy said that you linked to a few days ago was definitely true of me.
I am about almost even from the drop now in terms of my trades. Usually, i would have expected to be much more on the plus side by now.
Ghost of Igloi wrote:
one of the more,
Generally that is the experiencd of most investors. Can you imagine what will happen when buy on the dips continuously move lower? Don’t kid yourself it won’t happen and in fact highly likely from here.
Igy
Yes, it could but who's to say if it's more likely. Obviously the mass of the market doesn't agree becuase demand is greater than supply, hence stock prices are rising.
But then i would eventually cut my losses, however substantial. I've always been able to get back invested on the rise, though.
In the 2009 drop, i sold just about everything. I lost all faith it would turn around anytime soon. But i did buy back somewhere near the bottom.
ANds there's a couple of quotes i live buy: "Don't try to catch a falling knife" and never double down on a triple leverage ETF (or equally risky investment)
Ghost of Igloi wrote:
Ready for an early afternoon nap. Doing well so far but anticipating tougher times mid-treatment. Fortunately, other than this significant issue, I am very healthy.
I enjoy posting on DGTD and LRC, doing my best to ignore the negative side.
Igy
Everybody knows my opinion and position after 4 years of posting. I really have nothing else to say.
The last thing I would want is to be accused of nastiness.
We'll see how it all plays out over the next several years. Been fun.
mellon,
I was not referring to you.
Igy
Ghost of Igloi wrote:
Seattle,
How does that work for the buy and hold investor?
Igy
Different strategy, but history shows it works very well.
Ghost of Igloi wrote:
Seattle,
Did you sell any of your new positions when you were down more than 5% a few weeks back? By definition a buy and hold investor would lose any advantage other than dividends.
Igy
By definition, a buy-and-hold investor would not have sold a few weeks back.
Try to keep up wrote:
Ghost of Igloi wrote:
Seattle,
Did you sell any of your new positions when you were down more than 5% a few weeks back? By definition a buy and hold investor would lose any advantage other than dividends.
Igy
By definition, a buy-and-hold investor would not have sold a few weeks back.
Go back and read the dialogue and you will see you missed the context. So please try to keep up.
Try to keep up wrote:
Ghost of Igloi wrote:
Seattle,
Did you sell any of your new positions when you were down more than 5% a few weeks back? By definition a buy and hold investor would lose any advantage other than dividends.
Igy
By definition, a buy-and-hold investor would not have sold a few weeks back.
Yes, i did sell some of the new positions. Some of them were intended as short-term trades but some weren't. It wasn't a good stretch for me. I lost more than i should have selling at the wrong time and trying to get back in only to have it drop again. I think i would have been better to just let them ride.
Buy and hold investors sell, too, don't they? I think that the fact that that downturn was much steeper than a usual downturn/dip threw me. Things have evened out in the last few days, though.