What is your game plan as market is reaching its previous all time high?

flyingaway · Post by **flyingaway** » Wed Jul 22, 2020 6:27 pm

For me, I'm going to do a rebalance, probably a little bit larger than normally planned, slightly before the market reaches the previous all time high.

Background: 56, FI achieved, wants to maintain asset allocation between 70/30 and 60/40.

What is your game plan?

tooluser · Post by **tooluser** » Wed Jul 22, 2020 6:57 pm

Keep doing what I'm doing. A significant pullback, while disheartening in the short term, will not ruin my plans. If a pullback stays around a while, I am flexible enough to keep going. If the upward movement keeps going (Excelsior!) I may reach my goal sooner.

Excelsior, by Henry Wadsworth Longfellow: (it's short!)
https://www.poetryfoundation.org/poems/ ... 223cb4e6fa
Hmm.

runner3081 · Post by **runner3081** » Wed Jul 22, 2020 6:57 pm

Continue doing what we have been doing for the past 10+ years. Monthly investing to meet our AA.

Monsterflockster · Post by **Monsterflockster** » Wed Jul 22, 2020 7:00 pm

No changes. I got 20-25 years before I retire. There will be a few other bumps, bruises and catastrophes along the way I’m sure.

Explorer · Post by **Explorer** » Wed Jul 22, 2020 7:01 pm

Stay with the force! Or should I say "Stay the course!"

arcticpineapplecorp. · Wed Jul 22, 2020 7:06 pm

there's nothing wrong with rebalancing if that's what your IPS tells you to do. do you have an IPS? If not: https://www.bogleheads.org/wiki/Investm ... _statement

everyone should be following their IPS, not "doing something" just because the market's close to its previous high.

The question smacks of market timing, which makes me think, "how do I know the market won't reach a new high?" I don't.

The answer to all market timing questions (rebalancing not withstanding):

Q: When do I buy?
A: When you have the money.

Q: When do I sell?
A: When you need the money.

pretty simple. You don't need to ask, "What are you doing when X happens?"

livesoft · Post by **livesoft** » Wed Jul 22, 2020 7:08 pm

The ol' same same ol'.

Afty · Post by **Afty** » Wed Jul 22, 2020 7:09 pm

I plan to do nothing.

milktoast · Post by **milktoast** » Wed Jul 22, 2020 7:11 pm

TL;DR - I'm mostly buying bonds with new contributions and when we reach new highs, it will likely trigger a rebalance trade.

My plan calls for not buying bonds when SP500 is in correction, shifting target AA towards stocks every time I reach a point where my plan calls for shifting more contributions towards bonds.

So during the downturn, I rebalanced from bonds into stocks in order to maintain 70/30. Then during the recovery from the SP500 from low to 3050, I shifted target balance to 76/24.

If SP500 reaches new highs, I'll shift from 76/24 back towards 70/30 at a rate of 1% per month. If it turns down before then, I'll maintain 76/24 on the way down and shift more towards stocks during the next recovery.

Right now, we are hanging out between correction and prior highs, so roughly 2/3 of my contributions are being spent on bonds trying to bring me from current 77/23 back to 76/24.

PS. Yes, this is anchoring. And yes, it's not recommended. But it's my plan and I've stuck with it so far.

radiowave · Post by **radiowave** » Wed Jul 22, 2020 7:11 pm

Follow my IPS as I always do. Stock high has no bearing, I've got a good plan in place will rebalance when I reach my band limits.

TheDDC · Post by **TheDDC** » Wed Jul 22, 2020 7:13 pm

I have no need to rebalance as my long term retirement assets are all 100/0. I plan to continue to accumulate for life!

-TheDDC

SimplicityNow · Post by **SimplicityNow** » Wed Jul 22, 2020 7:56 pm

I'm just going to stand there and do nothing. Unless I reach the rebalancing bands in my IPS.

ruralavalon · Post by **ruralavalon** » Wed Jul 22, 2020 7:59 pm

We may rebalance soon, selling some stock index fund to buy more of our bond index fund, because we just reached our rebalancing band.

sailaway · Post by **sailaway** » Wed Jul 22, 2020 7:59 pm

Ask again in December, that is when we do our next snapshot.

Trader Joe · Post by **Trader Joe** » Wed Jul 22, 2020 8:00 pm

No change here at all. Buying VFIAX/VTSAX every single week like clockwork.

mortfree · Post by **mortfree** » Wed Jul 22, 2020 8:02 pm

I just noticed I have 10 shares of BRKB that have a small loss (-100) so I might sell them for tax purposes and to use towards a home project.

youngpleb · Post by **youngpleb** » Wed Jul 22, 2020 8:03 pm

Continue to divert new capital towards the further accumulation of equities

cdc · Post by **cdc** » Wed Jul 22, 2020 8:04 pm

I cut my equity allocation from 60 to 50 last week due to this year’s volatility. I’m 59.

TheTimeLord · Post by **TheTimeLord** » Wed Jul 22, 2020 8:15 pm

Interesting question that I hadn't thought about. Now that I do, I have a wild idea rolling around in my head but I doubt I will do it. So I guess as of now no plan, too busy thinking about what repositioning I need to do the rest of this week.

AerialWombat · Post by **AerialWombat** » Wed Jul 22, 2020 8:18 pm

I’m going to shop this loan estimate around until I get a better offer on my refi. That’s what I’m doing with my portfolio (aka, nothing).

UpperNwGuy · Post by **UpperNwGuy** » Wed Jul 22, 2020 8:20 pm

I don't understand the question. I will continue to invest a fixed amount on the first of each month as I have been doing all along. Why would I have a "game plan" just because the market has reached a high? The market has reached quite a number of highs since I've been investing, and there was no need to change course.

jarjarM · Post by **jarjarM** » Wed Jul 22, 2020 8:22 pm

SQQQ to hedge the downside

BrandonBogle · Post by **BrandonBogle** » Wed Jul 22, 2020 8:28 pm

rockstar · Post by **rockstar** » Wed Jul 22, 2020 8:32 pm

I can't predict tops. I'm not changing what I'm doing.

Toons · Post by **Toons** » Wed Jul 22, 2020 8:33 pm

Tending to the portfolio as I would a cactus.
As usual

Vanguard Fan 1367 · Post by **Vanguard Fan 1367** » Wed Jul 22, 2020 8:40 pm

With bond rates in the toilet I am at roughly 70/30. I would like to be 60/40 or 50/50 but bonds really stink right now.

retire2022 · Post by **retire2022** » Wed Jul 22, 2020 9:16 pm

Flyingaway, I just turned 60, my 89 year old mother just passed away in late march, not of Covid, as a result life too short.

I am planning to retire sometime by the end of the year.

I am planning to sell my entire 1.2 million 457 plan portfolio, as soon as I reach my number on which was at all time high Feb 21, 2020.

I am as of today 64K short.

Edit changed my mind, sold VSEQX (ROTH IRA) to VGT and Wellington 457 to SP500, up 2 million club.

I will be able to transfer my assets to Vanguard as soon as I am able to. Legally the plan only allows for transfers once retired, or no longer employed by my job.

I have my Roth IRA, Inherited Traditional IRA and other funds all at Vanguard approx 500K.

I've won the game, and will reinvest once all my funds are at Vanguard. I look forward to be Flagship status, not that it means much.

It don't matter to me that the market will go higher, being on the job for 34 years, pension and social security at FRA I will be ok.

flyingaway · Post by **flyingaway** » Wed Jul 22, 2020 9:26 pm

Good luck!

Broken Man 1999 · Post by **Broken Man 1999** » Wed Jul 22, 2020 9:36 pm

So far as my portfolio, I don't believe I would do anything except rebalance.

But if Mr Market climbs to an all-time high that is substantially higher than the last all-time high, I might engage in a mini-orgy of spending, doing a few home projects.

Broken Man 1999

HomerJ · Post by **HomerJ** » Wed Jul 22, 2020 9:36 pm

I'm 45/55... changed from 50/50 back in January (purely because I'm now 2-4 years from retirement, had no idea what was going to happen).

I check our money on the 1st of every month.

I don't rebalance on the down side (wish I had in March! I'd be retired today probably - but I'm about reducing risk, not maximizing gains)

I do rebalance on the upside... Last time I checked at the beginning of July, I was 43/57, so no reason to do anything.

I'm guessing at the end of July, I might be back to 45/55... maybe 46/54...

In any case, I won't do anything until I'm 50/50 again, at which point I'll rebalance to 45/55.

It's really that simple.

Wanderingwheelz · Post by **Wanderingwheelz** » Wed Jul 22, 2020 10:14 pm

I’m going to go from 60 to 55 soon, assuming the market advances further. I’m 49.

Not a market timing decision, since we planned to tone things down at a certain asset level. And here we are. One hell of a lot quicker than we ever thought.

grabiner · Post by **grabiner** » Wed Jul 22, 2020 10:20 pm

Check whether I need to rebalance. I have enough new money to invest that I have to check my allocation anyway to see where it goes, and since I had to rebalance into stock at the March bottom, I'll probably have to rebalance back if we are past the February peak. (I haven't been buying much more stock; I have bought some, but donated about the same amount to charity.)

novemberrain · Post by **novemberrain** » Wed Jul 22, 2020 10:24 pm

I am at 100% VTSAX; but with the nagging feeling that I am making a big mistake by not reducing the stock percentage. I am 40.

gubernaculum · Post by **gubernaculum** » Wed Jul 22, 2020 10:27 pm

keep investing 14K a month, FSCSX and VTSAX

TheDDC · Post by **TheDDC** » Thu Jul 23, 2020 12:25 am

Continue to fight that feeling.

-TheDDC

flaccidsteele · Post by **flaccidsteele** » Thu Jul 23, 2020 1:01 am

The same as my plan was in 1999 and 2005. Nothing.

I only “rebalance” into market crashes

novemberrain · Post by **novemberrain** » Thu Jul 23, 2020 1:34 am

Thanks

I need all the encouragement I can get. Hope I make it through the bumpy ride of coronavirus economy without reducing equity exposure.

mrspock · Post by **mrspock** » Thu Jul 23, 2020 2:29 am

I'm getting close 80/20 right now, with new money I'm working my way back to 75/25. From there it's back to rebalancing bands of 5%.

On the way down I'm very strict on rebalancing bands, on the way up, I give myself a bit of leeway to "let things ride" by a few % points beyond my bands, as I like to use new money to get things back into shape vs. trigger capital gains taxes (most of my portfolio is in taxable accounts), or burn my TLH "winnings".

Some additional context: Early 40s, I've achieved FI as well, my game is won, it's now just about running up the score a bit until I've "had enough".

Archean · Post by **Archean** » Thu Jul 23, 2020 7:23 am

We rebalanced into stocks per our AA on the way down this spring, and now have rebalanced a bit the other way to get back to our AA. Then felt the gain justified buying that travel trailer we had been eyeing, since international travel off the table these days. Then doing nothing.

whereskyle · Post by **whereskyle** » Thu Jul 23, 2020 7:31 am

I buy two etfs pretty much everyday: VT and VTI. Lately I'm buying mostly VT.

Chicken Little · Post by **Chicken Little** » Thu Jul 23, 2020 7:37 am

Similar.

Was 40/60 heading into decline, went to 60/40 in Feb/March, rolled back under 50% in June/July. Will stand pat until dust settles. Regular contributions very two weeks primarily into equity.

1. Last stimulus ended stock selloff, but I'm not sure how much upside there is to next round. If the market isn't a dummy, it should be "priced in".

2. Waiting to get better picture of economic fallout, particularly for small business (suspect that "chainification" of business will accelerate).

3. Waiting to see how many annual covid deaths there will be AFTER we're all vaccinated. Hopefully zero.

Don't address last comment (or delete). It's fine in context, because it is THE most important economic variable, and has to be part of a reasonable plan if you're doing anything other than set/forget. However, they don't like covid spreading on here and infecting other threads. There's nothing to add, besides.

Jack FFR1846 · Post by **Jack FFR1846** » Thu Jul 23, 2020 7:37 am

I rebalance when my AA gets 5% out of whack and I'm pretty close (4.68%). A point to consider....I could care less what the Dow, NASDAQ, S&P do. I care what my own investments do. Another fun point. The market hits "new highs" on average, once every 18 days, so if you miss this one, wait about 3 weeks for the next one.

Chrono Triggered · Post by **Chrono Triggered** » Thu Jul 23, 2020 7:50 am

I'm in my early 30's and 100% stocks, so I plan to keep on keeping on. I've entertained spicing it up with a small slice in some long term bonds as a hedge in case stocks plummet so I can scoop up discounted shares, but I'm still not convinced that I need bonds at this point in my life.

diabelli · Post by **diabelli** » Thu Jul 23, 2020 7:57 am

I would consider rebalancing except that I'd have to pay taxes on my gains.
I hate taxes.

nedsaid · Post by **nedsaid** » Thu Jul 23, 2020 7:58 am

I will probably rebalance. I am very close to my target 60% stocks/40% bonds and cash allocation so nothing to do right now.

avenger · Post by **avenger** » Thu Jul 23, 2020 8:01 am

2/3rds of the time the stock market is at an all-time high.

What are you doing on all of those days?

dodecahedron · Post by **dodecahedron** » Thu Jul 23, 2020 8:04 am

Donate some appreciated shares to charity to rebalance per my IPS and prepare for possible rollercoaster ahead.

fourwheelcycle · Post by **fourwheelcycle** » Thu Jul 23, 2020 8:06 am

I am doing nothing - just watching and riding it out. I'm not rebalancing because I was in balance before the market dropped and I figure I will come back into balance as the market returns to its February, 2020 level. However, I think the market is currently at a very unrealistic level; I think it should still be at 19,000 or below. I expect a big drop later this year if/when Covid keeps spreading and there are renewed shutdowns.

If the market stays high this year even in the face of a contracting economy, simply because the Fed has printed so much money, there will probably be a day of reckoning ahead in a year or two as unsupportable debt leads to widespread business failures and possibly even bank failures.

r.walker · Post by **r.walker** » Thu Jul 23, 2020 8:09 am

65 yrs old, still working. My plan, as always, is to stick with my all-stock portfolio. As retirement approaches, I'm at 95% stock, 5% cash reserves (about 4 yrs expenses). I rebalance stock holdings 80/20 US/International once a year.

TheTimeLord · Post by **TheTimeLord** » Thu Jul 23, 2020 8:14 am

After looking at my equity balances and thinking about it overnight I am considering implementing my melt up protocol which establishes a dollar ceiling for equities and GTC sell orders to harvest gains in excess of that amount. Currently, I have roughly $1.15 invested in equities for every dollar I had invested when the S&P 500 hit it's peak back in February so trimming back some is a reasonable consideration.