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I own MSCFX, wife owns NAESX, but ALL of what's in the latter is in a 403b and the entire total--- not even $1,000 yet--- was given by the employer: a percentage of last year's pay. In our combined portfolio, MSCFX = 2.39% of total and NAESX = 0.74% of total.
I think it's a little early to buy this downdraft. If the other majors follow suit and pull back (say a ten percent decline in large caps) then small caps will probally double that at twenty percent or so. However, they will most likely lead in a rebound rally. The small/mid cap sleeve of my portfolio is down less than five percent from its high water mark with positive gains year-to-date as I write; and, my portfolio as a whole is down from its high water mark by just a little over one percent. I might buy a little IIVAX when I feel a bottom has been reached and in watching the technicals that I follow I don't feel we are there yet.
On the calendar ... May just arrived and we still have the hot summer to transverse before fall arrives when stocks usually stage a fall rally that usually continues through the winter months on and into May. So by my thinking and by the calendar, it's time for a break! Anyway, I am going to wait in my belief that better valuations might be had.
Here is another school of thought on how to buy the pull back. I have used this buy strategy before if I wanted to add to certain positions ... and, it works.
Lets say small caps pull back five percent and with this I'll buy a little towards reaching my target position. Now another five percent drop happens and we are now at a ten percent correction. Again, I'll buy some more towards reaching my target position. And, repeat the process until the target position is reached. In this way when the bottom has been reached you follow the same process and buy at certain stages in the rebound if your target position has not yet been reached. In this way, you have averaged in through the market decline and its rebound.
Now with me it is a little different as I am at about my full target position to small caps. With this, I'll be more inclined to watch and do a little buying towards what I think might be a bottom ... which is indeed hard to sometimes call. If I catch it fine and if I should miss it ... I'll be ok too. I do have some room to grow my small/mid cap sleeve but I want to incease the allocation at a point I feel would offer good benefit in doing so. And for me, we are not quite there yet for a buy as I feel there is more downside to come.
Just some additional thoughts for you to consider.
Comments
On the calendar ... May just arrived and we still have the hot summer to transverse before fall arrives when stocks usually stage a fall rally that usually continues through the winter months on and into May. So by my thinking and by the calendar, it's time for a break! Anyway, I am going to wait in my belief that better valuations might be had.
Old_Skeet
Here is another school of thought on how to buy the pull back. I have used this buy strategy before if I wanted to add to certain positions ... and, it works.
Lets say small caps pull back five percent and with this I'll buy a little towards reaching my target position. Now another five percent drop happens and we are now at a ten percent correction. Again, I'll buy some more towards reaching my target position. And, repeat the process until the target position is reached. In this way when the bottom has been reached you follow the same process and buy at certain stages in the rebound if your target position has not yet been reached. In this way, you have averaged in through the market decline and its rebound.
Now with me it is a little different as I am at about my full target position to small caps. With this, I'll be more inclined to watch and do a little buying towards what I think might be a bottom ... which is indeed hard to sometimes call. If I catch it fine and if I should miss it ... I'll be ok too. I do have some room to grow my small/mid cap sleeve but I want to incease the allocation at a point I feel would offer good benefit in doing so. And for me, we are not quite there yet for a buy as I feel there is more downside to come.
Just some additional thoughts for you to consider.
Old_Skeet