Originally Posted by displacedinMN:
What is happening today?
Worry or profit taking?
The market is extended from the 50 day moving average by a decent amount as indexes hit all time highs between last week and this week.
10 of the past 13 days have been green.
I worry what building some of you will jump off of when the market “corrects” by more than 2-3% in a short time. A 10% correction may kill some of you, let alone a 25-50% bear market. [Reply]
Originally Posted by KChiefs1:
Hell no I’m hanging on this rocket ship to the moon!
I might sell if it got down to $30 but I’m still holding.
I don't mean to be flippant, but are you at all worried that it will try to "go to the moon" via shortcut path through the center of the Earth? At this point, that seems like a very realistic possibility for a stock where the price is artificially high and not supported by good fundamentals. For your sake, I hope that does not happen. [Reply]
It's important to follow where the market is in relation to moving averages. There will be red days but the entire trend is still up. It's simply small corrections/profit taking that you see. Here's the SPY chart since March to help explain. Blue line is 50 day moving average.
Short term changes will NOT be linear. Short term changes also only matter to traders. If you aren't a short term trader, check the trend 1-2x a month and leave it be.
Originally Posted by lewdog:
I worry what building some of you will jump off of when the market “corrects” by more than 2-3% in a short time. A 10% correction may kill some of you, let alone a 25-50% bear market.
Relatedly, my worry is that we have an entire "generation" of "investors" who have learned that fundamentals don't matter and that big risks are better than sound strategy. That works somewhat in a long-term bull market, but if things go south, the first things that go with it are going to be those risky investments.
I'm rooting for the AMC guys, but a stock like that is always potentially 24 hours away from dropping into the single digits. [Reply]
Originally Posted by Peter Gibbons:
I don't mean to be flippant, but are you at all worried that it will try to "go to the moon" via shortcut path through the center of the Earth? At this point, that seems like a very realistic possibility for a stock where the price is artificially high and not supported by good fundamentals. For your sake, I hope that does not happen.
I worry everyday but my goal is to be a multi-millionaire & this is my shot to do it. It’s been a hard couple of months. [Reply]
Originally Posted by KChiefs1:
I worry everyday but my goal is to be a multi-millionaire & this is my shot to do it. It’s been a hard couple of months.
Originally Posted by lewdog:
The market is extended from the 50 day moving average by a decent amount as indexes hit all time highs between last week and this week.
10 of the past 13 days have been green.
I worry what building some of you will jump off of when the market “corrects” by more than 2-3% in a short time. A 10% correction may kill some of you, let alone a 25-50% bear market.
I've already got a building picked out. It's really more of my back deck, because it's not very high and it goes onto a soft surface. No sense in hurting myself. [Reply]
Originally Posted by DaFace:
Relatedly, my worry is that we have an entire "generation" of "investors" who have learned that fundamentals don't matter and that big risks are better than sound strategy. That works somewhat in a long-term bull market, but if things go south, the first things that go with it are going to be those risky investments.
I'm rooting for the AMC guys, but a stock like that is always potentially 24 hours away from dropping into the single digits.
Yes and No. This happens with every extended bull market. Happened in the dot.com crash too. New investors riding the gambling wave while making money. Seems pretty easy until it's not. Retail investors without risk management strategies will get crushed. Lots of lessons are learned this way but it is amazing that people don't study the past to avoid the same mistakes.
I find it fascinating when people have a stock that is currently down significantly for them, say 20%+. They continue to convince themselves that it's only temporary. Meanwhile the stock market indexes are setting new highs. If you are holding a stock that is doing poorly in a bull market, what do you think will happen in a correction? Does it have a chance to go back up? Sure. But the percentages say it's a losing position this far into a bull market.
And most new investors pay no attention to the indexes, but what they really should be doing is comparing their gains TO the index. If after 3-6 months you aren't beating the index in a bull market, you need to re-evaluate what you're doing because passive investing would have gotten you further ahead. [Reply]
Originally Posted by KChiefs1:
I worry everyday but my goal is to be a multi-millionaire & this is my shot to do it. It’s been a hard couple of months.
Amen to that, brother. I am way too risk adverse to have the courage to do what you are doing. I'll keep rooting for you at a distance though. [Reply]
My 401k is in the following funds. I recommend index funds for 401k's since generally the expense ratios are super low. It really depends on what your company offers. The company I was with before this had absolutely crap fund options, all mutual funds and very expensive. I was so happy when the new company had tons of Vanguard options.
Vanguard 500 Index Fund - Admiral Class (awesome fund if you have access)
Vanguard Mid-Cap Index Fund - Admiral Class
Vanguard Small Cap Index Fund - Admiral Class
American Century Emerging Markets Fund - Class R6
Expense ratios of .04, .05, .05 and .91 respectively. I am invested 70% in the 500 index and 10% in the rest.
5 year rate of return on these funds is 16.26, 14.60, 14.97, 6.91. I have seen others discuss possibly dropping international exposure as it appears it lags US stocks for decades now for many funds when dollar cost averaging.
100% equities for me given that I am 35. I am not pulling for a market downturn but it would benefit me long term to see a very strong downward move where I just keep investing in these passive funds (maybe even more so).
I have T Rowe Price for my ROTH IRA and they are a bit more expensive for actively managed funds. But many have done very well and I can diversify a bit with 2 funds I like from them, one being a communication/tech fund and one being health sciences.
Expense ratios for the 5 actively managed I have with them range from .68 to .80. Their 5 year rate of returns have been better than my 401k, however. 24.08, 25.89, 20.48, 18.46, 15.05. [Reply]
