Please! Make it stop! (Stock market crash)

FastEddieB said:
Our personal portfolio, mainly common stocks plus an IRA invested in mutual funds, is down 33% from Feb 14, when it had hit a new high. That's back to the level it was in Feb, 2019. And that's with dividends invested along the way, but also some sales.
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Same. Would be a good time to convert IRA to Roth IRA.
 
deonb said:
Same. Would be a good time to convert IRA to Roth IRA.
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You need to crunch the numbers, and that also depends on assumptions.
I have about 15 years to retirement; using my own assumptions, I break even from a tax perspective if my IRA value drops around 37%. To play it safe, I will wait until it loses 40% or more.

Tim
 
deonb said:
Same. Would be a good time to convert IRA to Roth IRA.
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I’m already withdrawing monthly from my conventional IRA. I could have waited one more year, but had basically made plans around starting this year - the year I turned 70 1/2.

Being retired and already in a pretty low tax bracket, not sure making the conversion and paying all the taxes due now would actually help.
 
Remind me of the advantage of converting from IRA (a tax-deferred vehicle) to a Roth (tax is paid at time of contribution but not upon withdrawl) at this particular time.
 
Let'sgoflying! said:
Remind me of the advantage of converting from IRA (a tax-deferred vehicle) to a Roth (tax is paid at time of contribution but not upon withdrawl) at this particular time.
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Here is the theory. Under traditional you pay taxes on the gains when you start withdrawing.
Under Roth, the gains are tax free when you start to withdraw.
Both statements are based on the idea of not withdrawing early :)

Normally, average annual returns between 5-10% will likely never make up for losing the capital now by converting.
However, when you get a big dip like we see now, in the following one to three years (I think 18 months was the mean), the market comes roaring back; often seeing double digit or high growth. This can make it advantageous to pay the taxes now on the lower value.

Last point, the longer you have to retirement, the more valuable the conversion has the potential to be since the gains are a greater portion of the capital.

Tim
 
tspear said:
However, when you get a big dip like we see now, in the following one to three years (I think 18 months was the mean), the market comes roaring back; often seeing double digit or high growth. This can make it advantageous to pay the taxes now on the lower value.
Tim
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Also important - this only works if you convert to Roth without withholding, and pay the tax in cash. If you convert to Roth and do withholding to pay taxes (not sure why anybody would do this), then it really doesn't matter when you convert.
 
I have 20 ETFs in my portfolio. Each has a specific target weight. On purpose, the total % adds up to more than 100%.

I used the free version of Quantrx Portfolio Planner to pick ETFs so they are at most weakly correlated.

In one of his books, William Bernstein found the longer between rebalancing, the better the overall return. In the limit, the best interval for rebalancing is never.

So, I don’t rebalance. Whenever I have money to invest - 401K, dividends, interest, capital gains, etc, I update my ETFs NAVs, then use Morning Star to find the underweighted ETF with the worst 30 day trailing return to invest the new cash in.

The last time around, my worst performer was energy. It was down about half and shortly after my limit order executed, it’s shot up like a rocket.

I don’t always get those immediately phenomenal results but almost every time I buy the worst performer, it quickly turns around, sometimes to fast for my limit order to execute.

It’s my understanding that leveraged funds, and all flavors of inverse funds are extremely expensive and aren’t good long term holdings.
 
Crashnburn said:
I have 20 ETFs in my portfolio. ...
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That's a lot. Have you tried Portfolio Visualizer (https://www.portfoliovisualizer.com/)? I suggest comparing this portfolio to a single total US market fund or, if you have significant international exposure, to two total market funds -- one US and one International. I'd bet a Big Mac that you will find that your 20 funds portfolio basically just tracks the market. Maybe not, but it's worth a serious look if you have not done it.
 
airdale said:
That's a lot. Have you tried Portfolio Visualizer (https://www.portfoliovisualizer.com/)? I suggest comparing this portfolio to a single total US market fund or, if you have significant international exposure, to two total market funds -- one US and one International. I'd bet a Big Mac that you will find that your 20 funds portfolio basically just tracks the market. Maybe not, but it's worth a serious look if you have not done it.
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Thanks for the advice. I actually pruned it down from 30 a few years ago and went from every week to only when I have new money.

I like having these funds because it’s easy to target best down funds and have a different allocation than the total market funds. For instance, I overweight value equities and I can’t get that in a total market fund.
 
I maxed out my IRA for the year on Monday. So far its looking like I made the right decision.
 
Crashnburn said:
Not to brag, and I don't usually do this well, but today my IRA did a bit better than 2X the S&P500, almost 2.5X the Dow, and almost 4X NASDAQ. Doesn't sound like closet indexing to me.
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I usually measure portfolio performance over five year or longer periods. One volatile day tells you nothing except that you had a lucky day. It really means nothing, especially in the current market. But it feels good, I agree.

Actually there is a danger with this. Read Jason Zweig's "Your Money & Your Brain." It turns out that our brain rewards us with dopamine on gambling and market wins. This makes us remember wins and not remember losses, leading sometimes to problem gambling.
 
Looks like my stuff took a healthy but reasonable hit. Yeah, I finally looked.

The medical “fun” amazingly has fully settled and was 4x lower than I estimated for seeing four top Docs in their fields and two Mayo department heads and over 40 tests.

That helps a lot.

Not directly stock market related but totally amazed at the lack of fight from a major insurance carrier AND their pre-negotiated rates to them, and me. Not a single contested claim and no further billing expected looking over what was claimed.

Feels like Mayo was a “damn good investment”.
 
Groundpounder said:
Yep! I have another 23 years of this ride, I am sure this won't be the first dip that I will experience.
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Nope. I've been riding them since the 1987 crash. Each one you ignore makes the next one easier. And as a regular saver you should wish for these, as stocks are on sale at especially low prices. This is why dollar cost averaging works so well.
 
First, my portfolio usually outperforms the major indices every year, so it's not just luck (but luck will beat skill any day).
Second, sometimes when I go to add shares to a fund, and it's price is significantly lower than the last time I bought it, I tell myself that if it was a deal at $X, it's a better deal at $(X-Y).
 
FastEddieB said:
Our personal portfolio, mainly common stocks plus an IRA invested in mutual funds, is down 33% from Feb 14, when it had hit a new high.
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With the last two weeks of gains, we're now down just 16% from our Feb 14 high. Let's hope its a trend.

Edited to add: just 14% down now that our mutual fund gains posted for the day.
 
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FastEddieB said:
With recent gains, just down about 8%. Hope others have similarly recovered.
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Yes... and I had invested, just for fun, an additional $7000 in various individual stocks a few weeks ago.. my first time venturing outside of mutual funds. All but one has done very well, and two have almost doubled already.. with LOTS more growth potential. :)
 
FastEddieB said:
With recent gains, now just down about 8%. Hope others have similarly recovered.
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So far, yep.

Have too long of a timeframe to worry about it much, but paper mail for one of Karen’s accounts happened to show up, so I updated the budget/tracking numbers yesterday.

It’ll keep bouncing around on various “news”.

Her account is down $3000 from last November. Essentially a wash with around the end of last year.
 
FastEddieB said:
With recent gains, now just down about 8%. Hope others have similarly recovered.
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I only lost about 7% in the first place (bailed on 2/27), now recovering nicely. It's going to be a bit erratic for a while, but should trend upward overall.
 
I don't know what the percentage is from the crash to now, but lifetime my investments are up 17%.
 
JOhnH said:
That's what I did with GM. I thought GM will never go under. But guess what? I lost a ton on that stupid move.

And all this rah-rah, "good time to buy at a discount" doesn't take into consideration that a whole bunch of companies may go belly up if this doesn't turn around soon.

In spite of my OP, the slide didn't stop. Yesterday was the 3rd worst day for the market in history. It is the first time I lost well into 6 digits, and that was on top of all the other 6 digit (paper) losses I have accumulated lately. I have enough cash to last several more months before turning those paper losses into permanent losses. That is what I am worried about.
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Never try to catch a falling knife
 
Groundpounder said:
Mine aren't quite there yet, but darn close to it. Let's hope this recovery is a V and not a W.
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Same here. But the way things are going, . . .

never mind. Every time I make a prediction, something intervenes. :(
 
Yep. 401k is now positive in 2020 and growing nicely. Until the next inevitable crisis......
 
I bought seven various stocks, the first individual stocks I've ever owned (everything else I've done in the past and currently hold are mutual funds), about six weeks ago. Three of them have doubled, and the worst performing of the seven is still up about 40%. My long-term investments still have a few percent to go before regaining their all time high, but getting close. It's nice to have some GOOD news.
 
I’m still down, but as of Friday’s close, less than 2%. And this is with required monthly distributions of several thousand dollars.

Insert <sigh of relief> here.
 
I find it interesting that several different approaches all got us back to recovery close to the same point in time. By skipping the worst of the dip, I was able to be a bit cautious and reinvest less aggressively to make up the ground. I'm potentially only months away from retirement, so I'm less inclined to take big chances. Those with a longer horizon could stay aggressive, just ride it through and tolerate the big swings.
 
Groundpounder said:
Let's hope it continues.
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Yeah...I made a fair bit of money by doubling down on March 25, but this rally feels.... irrational.... to say the least.
 
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