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I would just hold it - I have sold most of my index fund holdings in the past 6-9 months and been just holding cash. I don't think stocks have reached the botto

I would just hold it - I have sold most of my index fund holdings in the past 6-9 months and been just holding cash. I don't think stocks have reached the bottom yet, so holding cash at 0% return is still better than negative returns from stocks. Right now, it's about not taking losses. I also don't see the market and economy rebounding quickly after reaching bottom - they will stay flat for a while IMHO

ushakov 4y ago
> holding cash at 0% as consumer prices are surging this no longer may be true my bet is on physical assets: guitars, gold, watches
- subsubzero 4y ago
  Gold looks ok, I don't know about guitars but watches are plummeting just like the stockmarket.
  - kingnothing 4y ago
    Which watches are plummeting? I've had my eye on a couple of specifics for a while and they're still as expensive as ever.
    - iancmceachern 4y ago
      Luxury collectable items typically suffer in a recession
atombender 4y ago
As a counterpoint, I would quote the great John C Bogle: "Never, never get out of the market." [1] Knowing when the market has reached the bottom is not really possible. During the dot com crash in 2000-2001, investors sold all the way down to the bottom (and lots of them sold at the very bottom), and then they eventually sold all the way up to the peak, when instead they could have just held onto their shares. Rebalancing doesn't really work. That's another thing Bogle showed us. Of course, if you need the cash, that's another matter. But then you arguably shouldn't have invested it in the stock market to begin with. If you have a time horizon less than 5 years, the market is just too volatile. [1] https://youtu.be/1SLb1QJvTvg https://youtu.be/1SLb1QJvTvg
- notch656a 4y ago
  >"Never, never get out of the market." Cash is a market though, just a different market. If you hold cash you're in a particular market, one that has earned significant returns measured against equities this year. (of course, depending on timespan you may want to pick _which_ market you think best) It's been strange indeed. My highest yielding investment the past couple years was buying a new vehicle. Conventional wisdom says new vehicles are horrible investment, but in this market it's exceeded yields of every single asset in my pretty diverse basket.
  - sumedh 4y ago
    > If you hold cash you're in a particular market, one that has earned significant returns measured against equities this year. What about the last 100 years?
    - notch656a 4y ago
      Depends. Pennies from 1920? Beat inflation. $20 coin from 1924 ($20 was worth an ounce of gold, so it was just an ounce gold goin)? Beat inflation. Dollar bill from 1922? Lose, but mostly because the fed reneged on their obligation of gold backing. I believe If you held 100 years from 1805 to 1905 there wasn't much inflation at all. So it really depends.
      - TameAntelope 4y ago
        Not during the last 100 years, for the last 100 years. The whole point is you have no clue when the bear market will end, and a lot of the recovery happens in the first few days (or sometimes even just the one day) of the new bull market. Trying to pull in or out means you miss out on the best gain days.
  - kqr 4y ago
    So the refinement of the statement might be "never, never move your allocation to 100 % of a single asset." (But since you speak of a diverse basket, you probably know this already.)
andsoitis 4y ago
> so holding cash at 0% return is still better than negative returns from stocks holding stocks as they go down in price does not necessarily matter. It only matters at time of sale. Selling an index (or a particular stock or set of stocks) as they go down only to buy them again later is not the right strategy... you're incurring transaction costs at the very least and the fact that you cannot time the market means you'll probably lose out even further. Hold the index, unless you need the cash flow or forecast that you need more buffer for flexibility and don't want, in the short term, to be penalized for volatile stock prices (e.g. in case you need to sell to service some cash needs). And if you have the cash, continue to buy the index on the way down. If your view is that the market, over the long term, is the best generator of wealth, then continuing to buy into it is the more rational strategy. Inaction is sometimes the best action. There are more ways to be dead than being alive.
- Retric 4y ago
  If you can sell 100 shares today and use that money to buy buy 200 shares in 6 months then you are better off than if you had held 100 shares for that same six months as long as you buy back into the market. Actually trying to time the market is largely a fools game, but people do get lucky. Or more often realize they shouldn’t try and time the market.
  - andsoitis 4y ago
    Right. Hindsight is 2020 but that does not an investment strategy make.
  - roflyear 4y ago
    Yah and if I could buy bananas today for $1 and sell them tomorrow for $5 I'd be fairly wealthy. And if my uncle was a monkey and my aunt a banana farmer we'd all be well off.
  - seoaeu 4y ago
    Yeah, except in six months you’d be thinking of waiting until you could buy 300 shares, and might miss the buying window entirely
deleted 4y ago
[deleted]

ushakov 4y ago

> holding cash at 0% as consumer prices are surging this no longer may be true my bet is on physical assets: guitars, gold, watches

subsubzero 4y ago
Gold looks ok, I don't know about guitars but watches are plummeting just like the stockmarket.
- kingnothing 4y ago
  Which watches are plummeting? I've had my eye on a couple of specifics for a while and they're still as expensive as ever.
  - iancmceachern 4y ago
    Luxury collectable items typically suffer in a recession

atombender 4y ago

As a counterpoint, I would quote the great John C Bogle: "Never, never get out of the market." [1] Knowing when the market has reached the bottom is not really possible. During the dot com crash in 2000-2001, investors sold all the way down to the bottom (and lots of them sold at the very bottom), and then they eventually sold all the way up to the peak, when instead they could have just held onto their shares. Rebalancing doesn't really work. That's another thing Bogle showed us. Of course, if you need the cash, that's another matter. But then you arguably shouldn't have invested it in the stock market to begin with. If you have a time horizon less than 5 years, the market is just too volatile. [1] https://youtu.be/1SLb1QJvTvg https://youtu.be/1SLb1QJvTvg

notch656a 4y ago
>"Never, never get out of the market." Cash is a market though, just a different market. If you hold cash you're in a particular market, one that has earned significant returns measured against equities this year. (of course, depending on timespan you may want to pick _which_ market you think best) It's been strange indeed. My highest yielding investment the past couple years was buying a new vehicle. Conventional wisdom says new vehicles are horrible investment, but in this market it's exceeded yields of every single asset in my pretty diverse basket.
- sumedh 4y ago
  > If you hold cash you're in a particular market, one that has earned significant returns measured against equities this year. What about the last 100 years?
  - notch656a 4y ago
    Depends. Pennies from 1920? Beat inflation. $20 coin from 1924 ($20 was worth an ounce of gold, so it was just an ounce gold goin)? Beat inflation. Dollar bill from 1922? Lose, but mostly because the fed reneged on their obligation of gold backing. I believe If you held 100 years from 1805 to 1905 there wasn't much inflation at all. So it really depends.
    - TameAntelope 4y ago
      Not during the last 100 years, for the last 100 years. The whole point is you have no clue when the bear market will end, and a lot of the recovery happens in the first few days (or sometimes even just the one day) of the new bull market. Trying to pull in or out means you miss out on the best gain days.
- kqr 4y ago
  So the refinement of the statement might be "never, never move your allocation to 100 % of a single asset." (But since you speak of a diverse basket, you probably know this already.)

andsoitis 4y ago

> so holding cash at 0% return is still better than negative returns from stocks holding stocks as they go down in price does not necessarily matter. It only matters at time of sale. Selling an index (or a particular stock or set of stocks) as they go down only to buy them again later is not the right strategy... you're incurring transaction costs at the very least and the fact that you cannot time the market means you'll probably lose out even further. Hold the index, unless you need the cash flow or forecast that you need more buffer for flexibility and don't want, in the short term, to be penalized for volatile stock prices (e.g. in case you need to sell to service some cash needs). And if you have the cash, continue to buy the index on the way down. If your view is that the market, over the long term, is the best generator of wealth, then continuing to buy into it is the more rational strategy. Inaction is sometimes the best action. There are more ways to be dead than being alive.

Retric 4y ago
If you can sell 100 shares today and use that money to buy buy 200 shares in 6 months then you are better off than if you had held 100 shares for that same six months as long as you buy back into the market. Actually trying to time the market is largely a fools game, but people do get lucky. Or more often realize they shouldn’t try and time the market.
- andsoitis 4y ago
  Right. Hindsight is 2020 but that does not an investment strategy make.
- roflyear 4y ago
  Yah and if I could buy bananas today for $1 and sell them tomorrow for $5 I'd be fairly wealthy. And if my uncle was a monkey and my aunt a banana farmer we'd all be well off.
- seoaeu 4y ago
  Yeah, except in six months you’d be thinking of waiting until you could buy 300 shares, and might miss the buying window entirely

deleted 4y ago

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