I know two bears who really left a lot of money on the table this year because they paid too much attention to the MSM an the constant fear predictions.

Thankfully neither were using leverage and just missed out on gains so they can cope by telling themselves they didn't really lose anything.

Bear #1 is mid 30s and sold almost everything he had at the end of '22 and was thinking about putting all that money into a rental property. They had place under contract, but after running the numbers they backed out because insurance and taxes where more than they expected. He wanted to put the money back in the market but has been looking for "a good entry point" for the last year. I would guess he probably "only" lost ~$35k sitting out this year.

Bear #2 is a retired 70 year old with a $3 million portfolio but doesn't even touch it because he mostly lives off his pension. He has a guy who manages his money for him for 1% AUM and has a bunch of letters after his name but none of them are CFP, CPA or CFA. I looked a few up and its mostly insurance sales stuff. His guy convinced him to go 100% cash in December last year because of the "obvious" recession. Bear #2 will be fine because he doesn't even spend his money and he is happy as a clam because his broker has convinced him that he did well earning interest in the money market. I would guess bear#2 missed out on at least $400k trying to time the market rather than just keeping a balanced portfolio and paid a guy $30k last year for the privilege.

there was a lot of bear sentiment on this board as well i'd say

do FA's really tell their clients to go "100% cash"? that seems like a pretty wild suggestion

Diggity said:

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do FA's really tell their clients to go "100% cash"? that seems like a pretty wild suggestion

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Good ones don't but the guy I am talking about doesn't really spend any of his portfolio so the salesman who he trust to manage his money took a risk that really wouldn't hurt either way. He sold everything to cash and if he got a the recession he was banking on, he would have looked like Burry level genius and have a client for life. If he missed like he did, he can sell it as protecting his assets and saying who on their right mind would scoff at 5% guaranteed return.

Definitely a lot of empathy. We live in a society that requires people to enter the arena of investing, with no equipping at all, where leeches are ready to attack.

This thread isabout the worst I can think of. After being sucked dry by "financial advisors" and family members, they throw their hands up and go all-in on a 3.5% annuity. Doesn't surprise me their peak confidence coincided with the bear market bottom.




The problem is now that we're discussing this topic, probably means a short-term market top

Tex117 said:

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RockOn said:

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The problem is now that we're discussing this topic, probably means a short-term market top

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Yup. Right here. Always seems that once these kinds of things start being discussed is about the time the top has been hit.

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I say bring on the true bear market. I am diversified enough I could rebalance into the dip and make a killing just like I did in 2020 and 2022. I would never argue one extreme or the other just sad to see all the bears go all in because cnbc was basically reporting 100% chance of retesting 2022 lows

Thankfully I got back in late summer. It seemed the tea leaves were changing then. Not that I knew anything.

The Chicken Ranch said:

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Thankfully I got back in late summer. It seemed the tea leaves were changing then. Not that I knew anything.

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That would have been a good time for the guys I know to hop back in... The problem with playing the go cash and wait for crash game is when the time comes to jump back in you better be ready to pull the trigger. Too often I see people play that game and when the dip comes, they get scared and think it's still going to go down and decide to hold out for a bigger dip.

It sounds like such an easy and smart strategy, but it's basically playing Russian roulette with your retirement.

Don't know exact dates or levels, but a family member sold out summer of 2018 'because the market is too high' (.gov TRS account). I think the low was on Christmas eve that year, I think around a 20% drop from the high. He was feeling pretty good about his sell. A year went by and he always asked me 'did you buy back in?', I told him I never sold.

He got FOMO mid/late 2019, sold during the COVID crash and has been struggling to ease back in the last couple years because 'it's just going to happen again'. Would have substantially more money had he just stayed in the whole time, added each paycheck, and rode the wave for another 25 years until retirement.

My dad was the same way (.gov TRS account). Had his retirement in the G fund his whole career...not a bad plan in the 80s I guess when it was 10%, but left considerable sums of money on the table over his 30 year career.

Diggity said:

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do FA's really tell their clients to go "100% cash"? that seems like a pretty wild suggestion

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Right? How would FA's make any money off their clients if they're all 100% cash. Makes no sense.

don't think that's how it works

permabull said:

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The Chicken Ranch said:

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Thankfully I got back in late summer. It seemed the tea leaves were changing then. Not that I knew anything.

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That would have been a good time for the guys I know to hop back in... The problem with playing the go cash and wait for crash game is when the time comes to jump back in you better be ready to pull the trigger. Too often I see people play that game and when the dip comes, they get scared and think it's still going to go down and decide to hold out for a bigger dip.

It sounds like such an easy and smart strategy, but it's basically playing Russian roulette with your retirement.

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In the end, its just damn near impossible to time the market. Sure some folks get lucky...But thats just gambling. Not investing.

There are some stats out there that in the last 30 years or so you missed out on certain big days (like 70 different days), and invested right after those big days, your returns were less than half.

In other words, by the time you get back comfortable, the market has already moved on.

Better to just shut up. Stay invested. Stay disciplined (depending on age). And ride the wave. The market has to come to you, not the other way around.

Tex117 said:

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permabull said:

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The Chicken Ranch said:

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Thankfully I got back in late summer. It seemed the tea leaves were changing then. Not that I knew anything.

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That would have been a good time for the guys I know to hop back in... The problem with playing the go cash and wait for crash game is when the time comes to jump back in you better be ready to pull the trigger. Too often I see people play that game and when the dip comes, they get scared and think it's still going to go down and decide to hold out for a bigger dip.

It sounds like such an easy and smart strategy, but it's basically playing Russian roulette with your retirement.

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In the end, its just damn near impossible to time the market. Sure some folks get lucky...But thats just gambling. Not investing.

There are some stats out there that in the last 30 years or so you missed out on certain big days (like 70 different days), and invested right after those big days, your returns were less than half.

In other words, by the time you get back comfortable, the market has already moved on.

Better to just shut up. Stay invested. Stay disciplined (depending on age). And ride the wave. The market has to come to you, not the other way around.

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It's even worse than that. It is like 20 days and you have halved your return.

Heck, this past month was like the 5th best month of the market ever. If you miss a 10% return in a month, you are forever behind the 8 ball.

These sorts of posts have been exactly what I have been waiting for. When the guys at work start talking about having to work forever is the last one on my checklist.

BoydCrowder13 said:

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Tex117 said:

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permabull said:

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The Chicken Ranch said:

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Thankfully I got back in late summer. It seemed the tea leaves were changing then. Not that I knew anything.

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That would have been a good time for the guys I know to hop back in... The problem with playing the go cash and wait for crash game is when the time comes to jump back in you better be ready to pull the trigger. Too often I see people play that game and when the dip comes, they get scared and think it's still going to go down and decide to hold out for a bigger dip.

It sounds like such an easy and smart strategy, but it's basically playing Russian roulette with your retirement.

---

In the end, its just damn near impossible to time the market. Sure some folks get lucky...But thats just gambling. Not investing.

There are some stats out there that in the last 30 years or so you missed out on certain big days (like 70 different days), and invested right after those big days, your returns were less than half.

In other words, by the time you get back comfortable, the market has already moved on.

Better to just shut up. Stay invested. Stay disciplined (depending on age). And ride the wave. The market has to come to you, not the other way around.

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It's even worse than that. It is like 20 days and you have halved your return.

Heck, this past month was like the 5th best month of the market ever. If you miss a 10% return in a month, you are forever behind the 8 ball.

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Yup. Its this.

No it's called derisking. Do you think bill ackman and half of congress were just lucky when they did the same?

Charismatic Megafauna said:

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Hopefully nothing like that hits again anytime soon, but s&p is up 22% for the year, i can't see anything wrong with going cash/mm heavy for a little while and see what happens

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Nor do I, depending on your time horizon. I am just saying 100% cash is just as risky or if not more risky than 100% stocks. A balanced approach is a good idea, but it should be done in a way to lower volatility over the long haul... not b/c things are feeling a little frisky so I better tap the breaks and try to gap down.

Most people were saying we retest 2022 lows... Even as recently as a few months ago everyone was saying the hammer was going to drop in q4

I.e. https://texags.com/forums/57/topics/3384565

if you don't play the casino you will eat dog food

I think what the fed told us today is that they are just going to open the QE valve again. I really think since 2008 there is no real concern about inflation. It's all about the perception that everyone is getting wealthier by keeping the market rising to please the politicians. The only long term winners in this situation will be ones holding inflation hedge assets. That's the bottom line.

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$3 million portfolio but doesn't even touch it because he mostly lives off his pension. He has a guy who manages his money for him for 1% AUM

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Is he aware he's paying too much? Is this FA advising or actively managing?

Charismatic Megafauna said:

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No it's called derisking. Do you think bill ackman and half of congress were just lucky when they did the same?

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This really isn't what we are talking about.

YouBet said:

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Quote:

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$3 million portfolio but doesn't even touch it because he mostly lives off his pension. He has a guy who manages his money for him for 1% AUM

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Is he aware he's paying too much? Is this FA advising or actively managing?

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I think it's "actively" managed since he said he can't go online and make any trades and has to call him up for that. The reason he is still with him is because he knows nothing about investing and it was his wife (no longer with us) who worked with him since the 80s and his philosophy is why change partners once you make it to the dance. He tried to rope me on with his guy about 10 years ago and I didn't like him. He was too political and used his politics to predict movements which is why I think he convinced this guy to go all cash, you know bc #fjb.

I think politics are red and blue but money is green and turn that noise off when it comes to investing.

Ok how about this: 90% of the markets gains in a given year are made in just 8 days, or something like that, right? So what's wrong with going flat once in a while when your spidey sense starts tingling? Seems like not much chance of missing a run while providing a lot of peace of mind