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Strategies & Market Trends : Portfolio Protection + Money Management for the Long Term
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To: Investor2 who wrote (51)4/20/2000 1:06:00 PM
From: Tom Trader  Read Replies (1) of 57
 
If you believe that, then why be 90% invested in equities in your retirement account?

First, I could be wrong about the decline that I am expecting.

Second, my entry levels into stocks in my retirement account are fairly decent and they are stocks that I am willing to own for the long haul -- the decline that I am expecting will be a test of the recent lows with perhaps some likelihood of making new lows -- the oft talked about 2800-2900 level on the NAZ is one that looks like a magnet.

Third, the disposition of certain stocks in my taxable accounts were based on a more fundamental premise -- namely that there were better stocks to own for the long haul especially given the current market environment. The disposition of the more desirable stocks was more a timing decision predicated on the anticipated decline -- and the fact that the taxable gain resulting is not substantial especially when it is offset with the losses that I referred to in my previous post.

However, obviously if the anticipated decline were a certainty -- especially of the magnitude that could get us below 3000 on the NAZ, I ought to be more aggressive in my selling of stocks. It is the recognition that I might just be dead wrong that causes me to be more restrained as well as to have taken long call options as part of the overall strategy.
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