It’s a market of stocks not a stock market.
I do believe the above. But whereas Ahhaha seems to hold money in cash looking for ideas, I tend to be mostly invested somewhere in the markets. I don’t ever recall doing any market timing other than to go 101% invested when I can see (well think) that nobody wants to be in the market. There are numerous problems with pulling out of the market. First and foremost, is that the odds are that you’re wrong. The second is that it seems to be a fools game. The reasons you tend to pull out never really ever let you get back in. How many examples have we all seen where someone might time getting out perfectly, but by the time they get back in, the markets are the same or higher than when they left? Ahhaha excepted.
Over on Wexler’s thread, Bill called for the bear. Before Ahhaha took a pause, it seemed (I can never really tell), He too sees the Bear. Though I do have plenty of reasons for a continued Bull, I am going to follow through with my comments to Mr. Wexler.
http://www.siliconinvestor.com/readmsg.aspx?msgid=29361599
And do some selling. 20% to cash.
Now for most of you that might seem to be fully invested, not for me. Everything is relative.
Although I don’t see why many would care, and If Ahhaha is still around, at the risk of being branded a slob, I thought I would write it out.
Somewhere in an old post I wrote that I found that tops and bottoms of the stock market seemed to be related to the number of times I look at my accounts. Once a week, or a couple times a month being kind of normal. Bottoms are usually found when I can’t even bear to look at my account or bother opening my monthly statements anymore. Tops of the market seem to occur when I look expectedly at my accounts more than once a day. It’s not scientific, there is no formula, it’s just a sign. Well I’m guilty, even to the extent of figuring my TROR more than once in a month. So with that realization I thought I would tout up my concerns.
First this bull market is long in tooth. The average bull market seems to run from 40 to 60 months depending on the author. Second, Complacency, to me most everyone I relate with are very comfortable with the markets in general. More and more are buying the dips, patting themselves on the back and feeling brilliant. We aren’t at the tippy top where my grandma calls and asks if she should buy some of that there Google stuff with her CD money. Ive been given stock tips from low quality sources but not from the baggage boys ,or my college age kids yet. Rampant speculation? just watch the marijuana industry trade….. Plenty of time?
I also have found that most Bear markets are born without fanfare. They are unforeseen events that may be perceived, but generally overrun with bullishness. They may hit hard in the beginning, but they linger as people buy into the weakness. As the event unfolds the public ignores the signs and keeps buying lower and lower, because they know its going to go back up THEN they will get out. The beginnings of the bull. After the steep prolonged drop, the media declares what caused the bear market. The media goes back to the first hint of this cause and screams “see! We should have known it”. 20/20 hindsight at its best. Somewhere in all that hype a Guru will be born.
To me things are good. Each bout of bad news (emerging markets, China, Ukraine, interest rate fears) are dealt with and discarded. I’m comfortable with what I own and think the upside is pretty good. Well, that usually means in the past time that I should have taken some off the table.
So then how will I “plan” my return. Better to define it here while I’m thinking straight because as sure as anything, when the time comes, I won’t have the stomach for getting back in. 20% Bear start. Dollar cost average over a year to 18 months (well unless I can’t open my statement THEN I’m all in). Now that may be from DOW 40,000 but let’s face it the more than 70% of my investments still invested should have done quite well during that time. Should the market continue as it has for another year, about this time, I will take another 25% off. That would be more cash than I ever had.
It’s been a fantastic 3 or 4 years. Far better than my original projections. Sitting on a bunch of cash (munis actually) for a while will bring down those overall returns, oh well. So I’m still bullish overall and for the long term. But for those looking for non perma bear comments, for what it’s worth, there ya go.
Good luck to all!
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