Marseille07 wrote: ↑Tue May 04, 2021 2:20 pm
You do you, but I'd be concerned if I were slashing equities to pay bills. You mentioned quarterly rebalancing, which seems to imply you have some fixed income? Why aren't you paying bills out of fixed income
To continuously maintain my desired asset allocation, of course! You're correct that I have some fixed income (TMF), but I guess I should have explicitly stated that I rebalance with inflows and outflows in addition to rebalancing quarterly. Sometimes I buy/sell UPRO, sometimes I buy/sell TMF. Whatever keeps my allocation where I want it. I set my desired allocation, and the automation takes care of the rest. Market movements are typically much larger than these flows, though, so manual quarterly rebalancing is necessary to really keep things in check.
Looking over my transaction history, it seems like I'm more often selling UPRO and buying TMF in the current market environment. However, since I was already near my desired allocation, when the market went up yesterday, I ended up selling UPRO to fund my expenses, and when it went back down today, I ended up buying it back with the new income. This rarely happens which is why I felt inspired to post about it in the first place!
Marseille07 wrote: ↑Tue May 04, 2021 2:20 pm
You do you, but I'd be concerned if I were slashing equities to pay bills. You mentioned quarterly rebalancing, which seems to imply you have some fixed income? Why aren't you paying bills out of fixed income
To continuously maintain my desired asset allocation, of course! You're correct that I have some fixed income (TMF), but I guess I should have explicitly stated that I rebalance with inflows and outflows in addition to rebalancing quarterly. Sometimes I buy/sell UPRO, sometimes I buy/sell TMF. Whatever keeps my allocation where I want it. I set my desired allocation, and the automation takes care of the rest. Market movements are typically much larger than these flows, though, so manual quarterly rebalancing is necessary to really keep things in check.
Looking over my transaction history, it seems like I'm more often selling UPRO and buying TMF in the current market environment. However, since I was already near my desired allocation, when the market went up yesterday, I ended up selling UPRO to fund my expenses, and when it went back down today, I ended up buying it back with the new income. This rarely happens which is why I felt inspired to post about it in the first place!
Thanks for the explanation. It makes sense now. Your method is different from mine in that I already have enough cash out to pay bills coming my way, as I'm not a big fan of expenses dictating my rebalancing. Once I start withdrawing, I'd be nudging my AA via withdrawals but I'm not there yet.
Last edited by Marseille07 on Tue May 04, 2021 4:55 pm, edited 1 time in total.
It was a RBD for the majority of my portfolio. On the other hand, my dogecoin holdings are now up over 25,000% since I threw a couple bucks at it way back when
Let’s see what happens tomorrow. Of course I bought international so I did not benefit from this misunderstanding as others likely did.
So, now that we have the Bloomberg headline, "Yellen Clarifies Inflation Remark, Sees No Need for Fed to Hike" will everything reverse tomorrow from what happened today?
Robot Monster wrote: ↑Tue May 04, 2021 5:51 pm
So, now that we have the Bloomberg headline, "Yellen Clarifies Inflation Remark, Sees No Need for Fed to Hike" will everything reverse tomorrow from what happened today?
Futures as of now don’t seem inclined to reverse. They’re flat right now.
Of course, it’s more than 14 hours until the market opens tomorrow morning.
Retired life insurance company financial executive who sincerely believes that ”It’s a GREAT day to be alive!”
Robot Monster wrote: ↑Tue May 04, 2021 5:51 pm
So, now that we have the Bloomberg headline, "Yellen Clarifies Inflation Remark, Sees No Need for Fed to Hike" will everything reverse tomorrow from what happened today?
Futures as of now don’t seem inclined to reverse. They’re flat right now.
Of course, it’s more than 14 hours until the market opens tomorrow morning.
Futures are steadily rising. Let's hope today was an isolated incident and not a trend... historically May tends to be a down month.
Wealth is not about having a lot of money; it's about having a lot of options.
Not a bad day thanks to my small cap value, leveraged treasuries, commodities, and liquid alts/managed futures. It's not Boglehead canon, that's for sure, but I think bogleheads would do well to have a more open mind, at least for some slice of the pie, beyond TSM equities/bonds, which of course has a tailwind of 40 years of recency bias.
Robot Monster wrote: ↑Tue May 04, 2021 5:51 pm
So, now that we have the Bloomberg headline, "Yellen Clarifies Inflation Remark, Sees No Need for Fed to Hike" will everything reverse tomorrow from what happened today?
Futures as of now don’t seem inclined to reverse. They’re flat right now.
Of course, it’s more than 14 hours until the market opens tomorrow morning.
Futures are steadily rising. Let's hope today was an isolated incident and not a trend... historically May tends to be a down month.
We just need Yellen and JPow to hold hands while chanting the Latin incantation to undo her dark work of today: "inflatio nullo, intereso nullo, redit dominantur!!!" *all the glass at NYSE shatters*
Robot Monster wrote: ↑Tue May 04, 2021 5:51 pm
So, now that we have the Bloomberg headline, "Yellen Clarifies Inflation Remark, Sees No Need for Fed to Hike" will everything reverse tomorrow from what happened today?
Futures as of now don’t seem inclined to reverse. They’re flat right now.
Of course, it’s more than 14 hours until the market opens tomorrow morning.
Futures are steadily rising. Let's hope today was an isolated incident and not a trend... historically May tends to be a down month.
Source? I don't think this is true. It sounds like something that gets repeated so many times that it becomes "known".
I didn't know this until I looked it up just now, but the "sell in May and go away" adage refers to the 6-month period from May to October. Apparently you're supposed to buy back in November.
Ricchan wrote: ↑Tue May 04, 2021 9:57 pm
I didn't know this until I looked it up just now, but the "sell in May and go away" adage refers to the 6-month period from May to October. Apparently you're supposed to buy back in November.
Bad advice in almost every year of the last 20 from what I can tell.
Volatility continues but look at the timing of OP and look at where the market is today. Doesn't matter if you were investing in things like penny stocks or large-caps, the last year alone has been incredible. Now, I'm not one to "time the market" but when you get big dips, more times than not, they usually are opportunities to at the very least, take a starter or teaser position in my opinion.
This is a weird market. I understand the "re-opening" trade and all, but a lot of these re-opening stocks are now higher than they were before the pandemic and we have no idea how the demand will actually rebound. And you're seeing some great tech companies sell off pretty hard as if we won't be using tech in this brave new world.
atdharris wrote: ↑Mon May 10, 2021 1:43 pm
This is a weird market. I understand the "re-opening" trade and all, but a lot of these re-opening stocks are now higher than they were before the pandemic and we have no idea how the demand will actually rebound. And you're seeing some great tech companies sell off pretty hard as if we won't be using tech in this brave new world.
atdharris wrote: ↑Mon May 10, 2021 1:43 pm
This is a weird market. I understand the "re-opening" trade and all, but a lot of these re-opening stocks are now higher than they were before the pandemic and we have no idea how the demand will actually rebound. And you're seeing some great tech companies sell off pretty hard as if we won't be using tech in this brave new world.
People finally started looking at valuations.
According to Bloomberg, Nasdaq is selling off because of inflation angst.
Everything in the red except my GE stock, it squeezed out a $.05/share gain. So my 1000 shares of GE offset my other holdings losses by $50. Whew! Glad I had some safe ballast in my portfolio.
Yee Haw!
Broken Man 1999
“If I cannot drink Bourbon and smoke cigars in Heaven then I shall not go." - Mark Twain
Bloomberg just reported, "Asia Stocks to Track U.S. Slide on Inflation Angst".
"The run-up in raw materials is intensifying debate ahead of a U.S. CPI report Wednesday that is forecast to show a strong gain in April. The year-on-year reading will be amplified by the pandemic shock a year earlier, but it plays into a broader market concern that the Federal Reserve may be forced to raise interest rates sooner than current guidance suggest to contain inflation." link
"Japan’s Nikkei 225 falls 2.2% after U.S. stocks decline overnight" link
Last edited by Robot Monster on Mon May 10, 2021 8:39 pm, edited 1 time in total.
Marseille07 wrote: ↑Mon May 10, 2021 7:56 pm
SPX futures already -0.5%. Could be another ugly day.
Getting my buying gloves ready
I will buy more only after a 50% drop (which is never gonna happen) or the gains on my current investment are up 20% (looking for that to happen before the end of the year).
anoop wrote: ↑Mon May 10, 2021 9:39 pm
Those who are selling -- where are they putting their money?? 30-year bonds??
RE and crypto.
Crypto fell so not sure that holds. RE very possible. But if we hyperinflate, how will people pay to maintain their properties? They aren’t going to find renters that can keep up.
anoop wrote: ↑Mon May 10, 2021 9:39 pm
Those who are selling -- where are they putting their money?? 30-year bonds??
RE and crypto.
Crypto fell so not sure that holds. RE very possible. But if we hyperinflate, how will people pay to maintain their properties? They aren’t going to find renters that can keep up.
We probably won't hyperinflate: "hyperinflation is rapidly rising inflation, typically measuring more than 50% per month."
anoop wrote: ↑Mon May 10, 2021 9:39 pm
Those who are selling -- where are they putting their money?? 30-year bonds??
RE and crypto.
Crypto fell so not sure that holds. RE very possible. But if we hyperinflate, how will people pay to maintain their properties? They aren’t going to find renters that can keep up.
We probably won't hyperinflate: "hyperinflation is rapidly rising inflation, typically measuring more than 50% per month."
Not now. That will take 5-10 years to happen according to Burry’s tweets about how we are going Weimar.
Ricchan wrote: ↑Tue May 04, 2021 9:57 pm
I didn't know this until I looked it up just now, but the "sell in May and go away" adage refers to the 6-month period from May to October. Apparently you're supposed to buy back in November.
St. Leger's Day (September 15) is the proper day to come back.
I guess it all could be much worse. |
They could be warming up my hearse.
pokebowl wrote: ↑Mon May 10, 2021 5:45 pm
Inflation appears to be the driving factor of the week's freakout, at least until Wednesday.
what happens on Wed?
CPI due Wednesday is 3.6 % consensus, 2.9 % to 3.8 % consensus range. link
Versus a year ago when everything was depressed....
Nothing to see here, folks.
Ordinarily I would have agreed, but every company is complaining of it (has never happened in the last decade as far as I recall), and there’s the whole labor shortage thing with companies announcing raises. The commodity spike has been spectacular and unless the fed crashes the markets, I don't think commodities will drop.
I didn't believe, so early in my investing timeline, would I actually see the benefits of buying VTI. Every once in a while, looking at NASDAQ or QQQ, I think, "should I have weighted more into tech stocks? Tech is everywhere in our lives, right?"
I'm glad I stuck to VTI. Everything corrects itself back to the mean.
I don't think this is a period of prolonged tech dragging down the market. Arguably the most successful companies in the world are tech companies and they continue to grow. This hurts right now, but it won't last forever. There will be a rotation back to tech, probably once we hit correction territory.