Stocks are going up because of “TINA” - There Is No Alternative. Bonds are yielding less than inflation. Cash even less.
This is what I tell my wife who is a farm girl and whose father just put money in the bank. Can’t do that.
Unless you put in stop loss orders on everything you probably can’t get out of he market fast enough either. Is 10% your number? 20%? Probably not higher than that? I have never gotten out, sold some junk at a small down with the covid panic and bought some more of good performers but nothing dramatic, 15 to 18% of the portfolio out in cash for a couple of months. Never bought into the world is going to end panic.
Stocks are no longer a value proposition unless you accumulate divided aristocrats. Outside of that it is just a game, a gamble of emotions mostly. I watch things by the year, not the hour or the day. I have survived inflation of the 70s and 80s.
I hope that as long as I don’t spend more than growth - inflation and a little bit more I’ll be OK. If I ever see 20% bonds again I’ll even sell the mare and buy all I can get for the longest term possible.
Totally agree. The markets have evolved from "investing" to "gambling" for the most part. Computerized trading makes that even moreso, cuz the machines will start selling (or buying) and will do so to any "news" (or rumor). And when the machines start selling - as they did last March/April, the bottom can and will fall out quickly..perhaps more quickly than any time in history. (Remember last Spring? Numerous days when the "circuit breakers" kicked in not one, not two, but several times per day. That's never happened before - but it's likely we'll see precisely that on the next big downturn).
The traditional 'school of thought' is to not watch the day to day but "invest" for years while not watching (just like you said). Unfortunately, the markets are by and large now completely detached from INVESTING and are quickly evolving more into gambling, where the value of a stock has little to do with underlying valuation and more to do with emotions and what the Wall Street computers have decided to do with it..add in Technical Analysis and it gets even worse, cuz that's pretty much 100% computerized buying and selling..
An old Wall Street adage seems to apply more than ever.."Stocks take the stairs up, and the elevator down"..I'm pretty sure we're gonna see quite the elevator ride in the near future with the way Biden and the far left are pumping trillions of $$ into the economy..that's gonna be a disaster for US equities, bonds and cash. So for that reason - check out International equities, which don't have crazy, far left radicals running the country and who's P/E values are much more in line with "normal" than we have here in the US.