I have believed that in the past.
But the underlying reasons for this problem go beyond a correction (which I was expecting anyway).
I also fear the unintended consequences of all of the chaotic destruction of government agencies/deparments. I don’t think we’ve really seen the damage from that, yet.
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Agree. When looking at my allocation, I also evaluated by asking myself – “can I withstand/tolerate a 15-20% drop in stocks?”
Right now, I look at the Dow, S&P, etc., but I am not checking my account balances. I’m not going to make any panic changes now.
If you have good solid funds, then the best course is to keep them and wait for them to bounce back. If you have extra, buy good, solid funds that are cheaper now.
No one knows what is going to happen. You can just learn lessons about how you deal with dips and when the market recovers, to adjust your holdings.
If you followed the advice to have an emergency fund you should be able to weather the storm.
These tariffs are a no win scenario. They were not calculated correctly, they were applied poorly. They targeted both friend and foe. They targeted penguins and our own military base. They did not focus on the worse offenders. Just a screw up from the floor up.
I cannot see them producing the results wanted.
We have to be concerned about China deciding they don’t need our bonds any more. The estimate is they hold $759 billion in U.S. Treasury. That could be a retaliation point
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I don’t disagree what you said regarding the tariffs. 
I am curious: in a poker game, when all players call you bluff, would you take a 5-minute bathroom-break, then come back and say it’s a boring game and let’s not play anymore?
Today would be a perfect day to sell some stocks if you found out recently that you had too many, and you need to move to a more livable allocation. Mostly you don’t get one-day rallies like today, ever.
@kane22
Hope you took advantage of the artificial selloff and added to your investments. This is why amateur investors never do as well because they sell at the wrong time. You want to continually add to your positions in quality securities during events like this. This won’t be the last time this happens.
I will say you need a little more diversification in your portfolio.
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Yes, for example… bonds are a little bit on sale today. They are down -1.8% over the past two days, which for bonds is a big move. Buy low, sell high, whether stocks or bonds. And keep rebalancing, at least once a year.
I haven’t changed anything. Looks like we get 90 days to twist in the wind now. If I were to ever get even I’ll move it all to something safe. I’m still expecting the worst. I think the smart money will sell into the rally and go to the side lines and wait it out.
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Bear Market Rallies are a thing… they are powerful, seemingly unstoppable, they draw everyone in, and then… they fail.
My long-term momentum indicators still say it’s dangerous times. I’ve set some alerts, if I hit them, I’m going to sell and stay on the sidelines in cash, bonds, gold until momentum returns…
Note - my decisions are not emotional. I have set of models I’ve followed for a decade. But I’m not going to share my source, because I don’t want even the appearance of shilling for a commercial service.
The basics are described in this public article by Fidelity.
Stock signals | US stocks indicator & average | Fidelity
Kane22
Now it’s all gone, or will be in another week when we see the real panic selling start. I lost a 150k in the first two days. I should have moved everything to bonds
First, congratulations on living frugally and saving so well.
Second, it’s not “all gone” – If you were 100% in stocks (which you shouldn’t be), then the market level is about what it was a year ago. Don’t just compare to your balance when the Dow peaked at ~45,000. Also, your balance includes the company contribution, so if you put in 5-6% of your salary, the company matched it, so your contribution money was doubled! Where else can you find that kind of return?!? (edit – Maybe compare your current balance to the total of your contributions – you’ll see how much you gained between the match and the returns, even at this crazy time)
Third - sounds like you need to re-allocate to a level of stocks where you can tolerate a downturn, especially since you are closer to retirement - but not right now. Lots of resources online, or hire a fee-only fiduciary financial advisor. Also, if your 401k has any “advisors”, take advantage of that – you’re paying fees for their service. But converting to all bonds isn’t a guarantee, either – the bond market was about to crash, which caused DT to change the tariffs, again.
Fourth - do NOT make any decisions when you are in distress, upset, angry, going through a rough time, ill, etc. And maybe wait until the market settles a bit – it’s very volatile now and you can’t time changes in a 401k – it may take time to settle the change, and who knows what the market will be?
Good luck!
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Thanks. Nothing to do but ride it out now. Gold seems to be the only safe place now.
My plane was to wait till I was five years from retirement, and then get conservative. Thinking I would be leaving money on the table.
Our company match is topped at $1500. Not much but better than nothing.
You think the OP should be 100% in stocks at the age of 54? That seems aggressive for somebody that age. I’m also 54 years old, and have about 70% in stocks.
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The time to buy gold was when no one wanted it. It’s 3x off the December 2015 lows.
The time to buy {…} is when no one wants it.
No, I was trying to say the opposite. I think 70% is a good number. I’m a few years older, and that’s my target (60% S&P, 10% international).
Yep…following the famous Warren Buffet expression…
Our company match is topped at $1500. Not much but better than nothing.
I had a 403b plan – no employer match at all. Only my contributions. But still glad I did it.
Yes, all of the gold and silver sellers come out at times like these to sell.
Do NOT panic buy gold!
Talk to a fee-only fiduciary advisor if you need advice. Don’t listen to commercials/ads to buy gold and silver.
Yeah, the time to buy gold was 20-30 years ago. Not now
Y2K was an excellent time to buy gold. Gold bought then would still be outperforming the US stock market, even including the severe gold bear market in 2011-2016.
I bought my gold in 2015-2018 at $1200. It’s over $3200 now. I’m not buying any more.
However, gold mining shares are still undervalued relative to actual gold. It’s a small industry. There is only one S&P500 gold mining company, Newmont (NEM). The share of gold mining in the S&P500 is therefore still at an all-time low.
It has been relatively forgotten by Wall Street and retail investors until just this year… shares are up 46% since January 1. But I think they have a long way to go, mostly up. The industry is printing money, it has a lot of free cash flow.
There are gold mining index ETFs you can buy, so you avoid stock picking, a perilous task for this sector. VanEck GDX & GDXJ, iShares RING, Global X Gold Explorers GOEX. Dollar cost averaging into these shares would work.
No more than 5% of your portfolio. They are super-volatile. You have to strap in and hold on tight.
I am not an advisor - You are not my customer - If you do what I write about above, it’s on you
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