Adrenalize

vader1

I have been pulling some money out, putting some money back in, and playing around on dips and rises. I still have a bunch of money sitting in cash, and the market has done little in real terms since the beginning of the year. With all that said, all of my pulling money in and out does cause some stress. You have to just remain calm and stick to your plan. After all of the monkeying around I think I am up only 1.5% for my whole portfolio, according to my calculations, from where I would be if I had just left my money sit in the funds when I started. I have earned some interest in the cash accounts, missed out on some dividends from the stock funds, but also timed most transactions to my benefit. All of that for 1.5% might not be worth the hassle to most people.

But I actually still hope the dow goes down to 22,000 before the end of the year to make things easy for me. I could then just toss the rest of my cash back in, stop paying attention and feel that I made myself a nice profit for taking a risk. Cause.....its all about me.

s2000Junky

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vader1

My cash accounts that I get through my employer do a little better (~2.3%). Now my monkeying around has done a little better for me as the market is back up. I am probably closer to 2.5% better than I would have earned if I had not made any moves so it has worked a little bit, but I think it is really just luck more than anything else at this point. Dow is up about 6% for the year and I am up near 8.5%, but there could be another dive coming. Who knows? I got a little stressed from pulling money out and crossing my fingers.

vader1

Finally hit my trigger point. It may fall farther but I had a full 40% of my portfolio in cash and just dumped it back in. That was stressful but will pay off in the long run.

The market is about as beat up as bitcoin.

traditionalgrip

Vader, your patience payed off. Good luck going forward.

ISADE

Just getting into investing this year, currently using Robinhood, not the most sophisticated app or broker but I think a good app for beginners to learn about the market and risk and rewards.

I didn't know whether to start a new thread or not but do you all feel there's a recession in the next 3 months? 1 year? 2 years? Seems some podcasts i've listened to get the feeling that another drop/correction/recession is imminent based off the housing market and interest rates.

What do you think?

vader1

I really don't know enough to day trade or anything like that. For me, my money is mostly going to remain heavily in stocks and let it ride and collect gains and dividends. However, I think there are times when things don't feel right and you look at PE ratios and see the whole market is out of whack and will correct. When I see those, I see an opportunity to protect myself from some loss, pull money out, let the market correct a bit, and dump it back in. Nothing too exotic, money comes out, goes into money market account, and when market goes down, buy back in.

Now, everyone says you can't time the market. I pulled my money out and sweat a whole lot watching it climb, then pull back a bit, then climb higher. I pulled most out near the top, not at the top. I had no way to no what the top was going to be and frankly, did not need to. Just knowing everything was pretty overvalued and believing the was some kool-aid drinking was enough for me. I knew only one thing for sure it had to come down because it was simply artificially high when getting far above DOW 26,000. The PE ratios were at 24 for the overall market. I think my money sat in cash for several months. It was torture to be patient thinking I blew it, it was still going to go up (and some days or weeks it did) and then for no particular reason, the correction started. I waited and watched it plunge. It gained momentum and I had established a trigger. I happened to put my money back in at absolute bottom, but that part was luck. I was on vacation and could not move my money, when I returned home I wanted to put my money back in but could not get my login to work. The day I got through to customer service the market took its last big dive and I dumped back in. Had I dumped in earlier, I still would have made money from where I took it out, but the extra luck helped. I gained an extra percent gain on luck because my password failed to get me into my account.

Now the market is shooting back up again. Some of it could be euphoria. I think the market will absolutely be positive this year (without some major terrorist attack or natural disaster)just because it was negative last year and rarely does that two years in a row. That does not mean we might not shoot up to inflated prices now, pull back again and then end up positive. I have a dow 26,000 anywhere in the first quarter as a pull out point for my cash. Based on nothing but instinct that "That was too fast". If we approach that I pull money out and hope to see a correction sometime over the next two quarters. Any pullback then below 24,000 and I would dump money back in and let it ride the rest of the year. 10% corrections happen nearly every year. I think that if you spot euphoria and values that are too high, you can take advantage and avoid some dips. I would not attempt it at all without defining what is my "get in point" and what is my "get out point" and sticking to it no matter how uncomfortable it got because I would establish them based on reason and panic is based on emotion. I set those points not on what is the absolute top or bottom, but when we are getting close to either and making sure my move made a positive result, not the optimum result that requires me to gamble close to the edge. My moves will not be a weekly thing, more like pull money out when it gets to high, wait perhaps several months, then buy back in. Repeat maybe once every year or two when conditions are obvious. Otherwise let more experienced people at the mutual funds do the work for you. And when I say pull my money out, I take out a percentage and leave some in, I only want to hedge my bets, not make all or nothing plays. Last time I thought it was so out of whack I think I ended up 40% cash, but still had 60% stocks.

Can you lose further appreciation? Sure. Can you get burned? Absolutely. But I think I am willing to play a little until that happens. Maybe I will regret it. I also think though that if you want to follow the markets you will hear panic stories about the sky falling and stories about how the bulls will run forever. You have to read ALL of it. Filter out the BS, understand what is hype and what is actually on the horizon and not be sucked in by the story of the day. Things like consumer debt will burst a bubble some day. No avoiding it, but that does not mean the warning article today means it will happen now. My education is in accounting/finance but anyone who is smart and reads a a lot can get as much or more than I got in college.

My end goal is not to make a ton or get too greedy. My goal is to take advantage of obvious (to me) points when the markets are getting to full of themselves and take a little of the correction for myself. I hope to beat the market over the next ten years (when I retire) by ten percent. I don't think that will be too hard honestly for someone who pays close attention.

But I might come here some day and say I royally screwed up. I am fully capable of making a mistake and I freely admit them when I do. But it seems to me most people and their 401k's are totally passive investors and let it ride. An informed and reasonably intelligent person should be able to anticipate a point every couple years where there is a likely correction and protect themselves a bit, and do so. If that earns you a percent or two more than most people every couple years, you will do better than the vast majority of people. I don't want to gamble, but I lost 40% just like everyone else during the 2008 crash by not paying attention, I don't plan to do that again.

I might day trade with some fun money in the future, but I would never do that with my retirement accounts and only do that with what I could afford to gamble with. Good luck with your software, let us know how it works out. Oh and I think we will have a small recession which is still over a year away, but the market plunges before the recession. But this president will do what every other president does, and that is throw every tool he has at making the economy fire away before re-election. I think another half point on interest rates and tapped out consumers will eventually halt car sales and housing purchases and then we slide. Watch what the fed does in the next year. Sorry for the long rant.

ISADE

2020 Correction? What is going on with this stock market it's on fire and can't be put out. Is it all these auto-investing apps bringing in new money to the market? When everyone get's all giddy and believe the market will never go down, that's exactly when the markets start to turn and it seems like we're getting to that point. Are earnings going to start dwindling? I've removed some money out of indices and am now picking individual stocks at this point but definitely not getting out of the market (cus who know's when this bull will stop) just being picky.

s2000Junky

The more mighty they are the harder they fall, that's what i'm worried about. There is too much unnatural and irresponsible ****ery going on in the market right now I suspect. Its not sustainable indefinitely, then what?