Stock Market: The Thread

[fan_since79]

Damn it, should I start converting everything into cash?  I run bad this is ridiculous.  Literally, the first month I invest in my retirement and mutual funds, this crap happens.  You guys think the market will continue to tank?  Should I sell or wait it out?

 

If it's bothering you a lot, take some money off the table. If you sell everything right now, though, you lock in those losses forever. If you're young and have decades to go before retirement, this decline won't hurt you. But if you have cash on the sidelines, you'll be able to buy stocks at a great discount if this market does decide to crash. Those who bought in the spring of 2009 did very, very well.

 

But nobody knows how far this market will drop in 2016. Nobody. So, I can't give any specific advice. The pundits on TV like Cramer don't know either. He strongly recommended buying a bunch of companies in February of 2000 that later went out of business in the dot.com and tech crash.

[Catwhoshatinthehat]

Damn it, should I start converting everything into cash?  I run bad this is ridiculous.  Literally, the first month I invest in my retirement and mutual funds, this crap happens.  You guys think the market will continue to tank?  Should I sell or wait it out?

 

Whatever asset allocation you're comfortable with you shouldn't be selling on fear because in the long run you're going to sell low and buy high by trying to time the market.  The markets are getting hammered due to an overdue correction and there could be more declines yet the S&P 500 is still higher than it was at the end of January 2014.  How many people who sold then do you think got back in for the run up while receiving dividends over the last 2 years?  The short answer is people who sold then missed out on returns.  Take a deep breath, stop thinking about it in the short term and continue to invest.  If you're young or even have 10+ years until retirement the biggest thing you have on your side is time.  The closer you get to retirement the more conservative you should get.  The most important thing is unless you're day trading you shouldn't be thinking or worrying about what the market does day to day or even over the course of a year.  You'll end up driving yourself nuts if you check your balances at the end of each day.

Edited January 20, 2016 by Catwhoshatinthehat

[Angel Oracle]

Anyone who bought in November 1988, then sold in April 2000, then got back in during November 2002 (14 months after 9/11), made out like bandits.   That was a no brainer (record run up in late 1990s including numerous tech startups that couldn't keep up eventually). 

Edited January 20, 2016 by Angel Oracle

[aznhockeyguy]

Ughh, why did I have to invest at the beginning of the year?  I could've waited till today and got 10-15% more.  FML

[Catwhoshatinthehat]

Anyone who bought in November 1988, then sold in April 2000, then got back in during November 2002 (14 months after 9/11), made out like bandits.   That was a no brainer (record run up in late 1990s including numerous tech startups that couldn't keep up eventually). 

 

How many people do you think actually did that?  Saying it was a no-brainer is hindsight at it's finest because there's way more people who were in tech before the crash who ended up out of jobs and in some cases went from multi-millionaires to being broke than there were people who got out at the right time.  When it's good it seems like nothing can go wrong and when it's bad it seems like nothing can go right.  Think about the stories you hear of people who shorted the market before the 2008 crash because there aren't that many.  You hear a few where large investors makes a ton but there's way more stories of people who lost their asses doubling down buying high.  

[halobob]

Market well off its lows of the day...DOW "only" down 347 now.  

[Angel Oracle]

The stock market has never had more than a decade or so of run up.

November 1988 was a year after the Crash of October 1987, and thus it made sense to invest at that point.

March 2000 was a decade+ after the start of the biggest run up in stocks history.

 

It doesn't seem so hindsight, when considering that.   Aside from when to dump stocks after that big run up.

[Catwhoshatinthehat]

Yeah it doesn't seem so hindsight until you think about when to actually sell and buy back in.  You know, the most important parts of timing the market so you don't buy high and sell low.  

Edited January 20, 2016 by Catwhoshatinthehat

[fan_since79]

Huge rally right now in the final hour. The volatility is amazing.

[Amazing Larry]

This market is so broken. It would be funny if it wasn't so sad. Long live Skynet.

[mrwicked]

Damn it, should I start converting everything into cash?  I run bad this is ridiculous.  Literally, the first month I invest in my retirement and mutual funds, this crap happens.  You guys think the market will continue to tank?  Should I sell or wait it out?

 

my first piece of advice: i wouldn't ask a baseball message board for investment strategies.

not that there aren't smart people here, there are, but there's just no way to give you the kind of information you need without you providing a ton of information.

 

second piece of advice: don't try and time the market. its impossible. you don't need to just know stocks, you need to know international politics, like whats going on in china, etc. just have a plan and stick with it. and avoid selling out of fear. if you're in it for the long haul just ignore volatility like this.

[Tank]

Ughh, why did I have to invest at the beginning of the year?  I could've waited till today and got 10-15% more.  FML

 

look, you get in when you get in. if you're in it for the long haul, you'll be okay. if you're just looking to turn a quick buck, tough luck.

[aznhockeyguy]

I should clarify, I had a lot of cash and started funding a self Roth IRA and I also invested more cash to mutual funds.  My plan was to keep the cash in the mutual funds until I'm ready to purchase a home in about 3-5 years.  I'm not touching the Roth money.

Edited January 20, 2016 by aznhockeyguy

[Catwhoshatinthehat]

I wouldn't be putting money for a down payment on a place that I'll need in 3-5 years into any equity type investment, i.e. stocks, mutual funds, index funds, etc.  I consider anything I'll need in 5 years or less to be short term and not something I want subject to market fluctuations.   

[aznhockeyguy]

I wouldn't be putting money for a down payment on a place that I'll need in 3-5 years into any equity type investment, i.e. stocks, mutual funds, index funds, etc.  I consider anything I'll need in 5 years or less to be short term and not something I want subject to market fluctuations.   

 

Now ya tells me.  I still have 50% in cash.  I didn't want to get a CD because interest rates were so low.

[Catwhoshatinthehat]

As low as they may be I'm guessing they pay more than most savings accounts.  You can ladder CD's so you get your money back over the next 3-5 years at various interest rates.  That won't outpace inflation but you also won't lose a lot of your principal like you can if we end up in a bear market which is likely.  You kept 50% in cash which means you at least didn't risk it all so for now I'd keep the rest invested unless as mentioned you want to lock in losses. 

Edited January 20, 2016 by Catwhoshatinthehat

[aznhockeyguy]

Yes, they do pay more than Savings account.  I was willing to risk a little risk for an increased return, obviously didn't think the market would tank so hard the first month. 

Edited January 20, 2016 by aznhockeyguy

[Slegnaac]

Last month I opened a Scottrade account. With this down turn I was starting to think it was bad timing. But my shares of O are holding up.

[aznhockeyguy]

Last month I opened a Scottrade account. With this down turn I was starting to think it was bad timing. But my shares of O are holding up.

I had O for a bit 2 years ago, not sure why I got rid of it.

[Brandon]

Last month I opened a Scottrade account. With this down turn I was starting to think it was bad timing. But my shares of O are holding up.

Perfect timing. Buy everything cheap.

[Brandon]

As for the main question, a mentioned, ride it out. I can't think of anything dumber than putting money into something and taking it back a month later at a loss.

C'mon man, you used to play cards.....variance and long term gains/end game.

[aznhockeyguy]

As for the main question, a mentioned, ride it out. I can't think of anything dumber than putting money into something and taking it back a month later at a loss.

C'mon man, you used to play cards.....variance and long term gains/end game.

It's hard to keep playing during said variance as well.  I should stop watching the ticker.

[Amazing Larry]

Asian markets down again. It makes you wonder if the PBOC can really micro manage their economy to nirvana (silly little communists.) I wouldn't be surprised if Legarde or Draghi start flapping their gums to try and spark the market into the green before Wall Street opens in the morning. Man I wish baseball season was starting soon so I wouldn't be paying attention to this inevitable disaster.

[Amazing Larry]

Ha. Right on cue.

"U.S. stock index futures pointed to a higher opening Thursday amid ECB President Mario Draghi's press conference."

http://www.cnbc.com/2016/01/21/wall-street-eyes-more-pain-after-worst-close-since-2014.html

[mrwicked]

putting $$ earmarked for a down payment into equities is an awful idea.

its a good way to end up delaying your purchase.

the goal should be to simply maintain capital, not increase your capital via short term investments.