Dealer,
I went thru the entire downturn without selling a position. How does one know that "this is the time we will have a big correction?" The odds always are against it. How many 10% pullbacks turn into 34% pullbacks? Not many. So when you are down 10%, the odds are that you will go back up, not down, so why sell? The same could be said at 20% and 30%. A buy and hold strategy on balance makes the most sense to me, coupled with selling calls occasionally to raise cash for the inevitable downturns, as V recommends.
I think the only thing I am sorry about is at an individual stock level. I had some stocks that looked to be reaching short-term peaks, based on charts, and I held them. (I'm thinking particularly about SCH, AMZN, and CMB. AMZN is the one that bothers me the most, because I bought it more as a trade than an investment. The other two are investments for the long haul.)
It seems to me that the net present value of selling eveything every time there is a downturn is negative. Too many headfakes. I'm sure there are some who feel superior because they sold before the downturn, (or before it became a bloodbath), but I will believe it was luck or panic unless I hear some sound evidence to the contrary.
INTCfan |
