Stock Market going Crazy

[tactical_2012]

Stock Market going Crazy DOW over 29k, NASDAQ over 12k, S&P over 3.5K. Markets keep going up but getting a little worried whats going to happen as we get closer to election time. My 401k has 29.4% return for the year and I was down almost 20% during the dark days of the lock down. My 401k is full of aggressive stocks and think it might be time to dial it back. Like the saying pigs get fat and hogs get slaughtered.

[FoxtArt]

I am in rough agreement. It may even be wise to switch to bonds shortly before election day. Hard call, but doing that did save me from that 20% loss, I'm keen to avoid the next. Either way the election goes, this is becoming an unsustainable bubble imho, and as the saying goes... all good things must come to an end.

[battlemidget]

No one ever got hurt taking profit. Nothing wrong with paring down at a high.

[FoxtArt]

There is, however, a devils advocate on my shoulder that keeps saying "if we're going to suffer rampant inflation, the last thing you want is bonds or cash".

It's a hard call. Trump wins, riots and chaos. Trump loses, less riots and chaos but less economic confidenence. Either way, stimulus B.S. and unknown inflationary effects which may offset the amount of "dollars" otherwise lost even if we still lose value. Some lot of the market gains even now aren't actual gains in value, it's simply the net effect of the 3T credit card the government charged up a few months ago, the full effects just haven't percolated into the broader economy yet. So I still haven't decided what to do, but I'm still leaning towards bonds right before Nov 4. Then if the market doesn't take a fresh shit by the end of Nov, hop back in even if I've missed some potential gains.

[sroz]

I am in rough agreement. It may even be wise to switch to bonds shortly before election day. Hard call, but doing that did save me from that 20% loss, I'm keen to avoid the next. Either way the election goes, this is becoming an unsustainable bubble imho, and as the saying goes... all good things must come to an end.

The timing ("shortly before the election") is the tough part. Too early and you could miss out on some gains. This is fine if it means you dodged the crash. If the crash occurs before you pull the trigger, you may be along for the ride. A lot depends on where you are at wrt your retirement date. And of course the size of your retirement savings.

[emiller35]

All also truly depends how much time you have before retirement. If you are nearing that period of life I would look at becoming more balanced across some different funds that may not be as aggressive but return more than the bonds side of things. On the other hand if you are 20+ years out let it ride and see what happens as your cost basis will level out in the end.


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[earplug]

Win or lose the Federal Reserve will still pump cash into the system. Inflation will increase and cheap money will try and find a place to sit. The stock market is a place.
Bonds lock you into a dollar dominated investment that will depreciate with the devaluation of the dollar. If your bond return is 5% but the dollar devalues at 9% your screwed.
Look at a Gold or precious metal chart and its not far off the market indexes. Every major currency is a balloon.
As long as basic building blocks of civilization are at near record lows I won't trust the market. Copper is hovering at $3.00. Recall during a healthy economy copper was getting ripped out of vacant homes and sold.
Aluminum, fuel, steel, lead. Check the prices and past charts.

[Sawin]

why did you have to say that and get it all into a frenzy. It's been bloody since shortly after the OP ;)

[Sawin]

Win or lose the Federal Reserve will still pump cash into the system. Inflation will increase and cheap money will try and find a place to sit. The stock market is a place.
Bonds lock you into a dollar dominated investment that will depreciate with the devaluation of the dollar. If your bond return is 5% but the dollar devalues at 9% your screwed.
Look at a Gold or precious metal chart and its not far off the market indexes. Every major currency is a balloon.
As long as basic building blocks of civilization are at near record lows I won't trust the market. Copper is hovering at $3.00. Recall during a healthy economy copper was getting ripped out of vacant homes and sold.
Aluminum, fuel, steel, lead. Check the prices and past charts.

emphasis added to a very wise and insightful rule of thumb

[TFOGGER]

I'm loving the short term gains, but when I analyze stocks, I like to look at longer term value. That being said, I'm probably going to bail on some of my more volatile stuff before the middle of October.

[JTP80]

Yeah, I'm looking to reduce my risk next month some time. I hit 28% last year and am at 21% this year because I dropped some stock funds in late Feb and missed out some of the March drop, but missed the start of the rebound this summer. Bond markets worry me as the t-bills are so low of a return, effectively negative long term. And, there's too many medium and even large corps going into bankruptcy and so many cities and states scrambling from low tax revenues that you really have to look at what you're buying into.

[.455_Hunter]

I not sure about you folks, but I can change my fund allocation in minutes on Vanguard. I think right now I am running pretty close to their "recommend" bond/stock ratio for a 2040 retirement (at age 56). My 401K is just a portion of my portfolio, with the bulk being in property equity and ESOP holdings (18 years at an employee owned professional company has benefits), so I tend to let it run on automatic. I will definitely need to assess for a short-term lifeboat transfer.

[Little Dutch]

My retirement is a mess. I need to combine all my old 401k's into a single unit. I am trading my pittance of stock with TD Ameritrade and thinking about moving my retirement accounts over to them too. Keeping the active one with my current job where's it's at of course.

If I were better at guessing the market I wouldn't be working. But I like the idea of dropping into something a little less volatile before November. Rolling into simple interest for a month to miss the drop might be huge in the long run.

[MrPrena]

Buy LOW, sell HIGH.

Maybe to some, this market may be very LOW.
This is not a LOW market for me.

[tactical_2012]

Ya I'm able to switch my funds pretty easy the problem is once I jump out the current fund I'm in I can't buy back into fund I left for 30 Days

[FoxtArt]

I have self-directed 401k under Merrill Lynch. Commission free trades, Can't do options or certain equities or commodities ofc, (No ETF sadly..) but still, I've appreciated the fine control.