In checking the S&P 500 Index futures ... not good being down about one half of one percent as I write. In checking Greater Europe mostly red there along with most of Greater Asia also in the red.
Yesterday turned out not as bad as it could have been. Perhaps, today will be as well. But, remember as folklore has it ... "As goes January so goes the year."
I receive most all my mutual fund capital gain distributions in cash and, with this, I have been raising my allocaton in cash since June of 2014 from about 10% to its current level of 25% while reducing my allocation in stocks from 60% to 50% and reducing my bond allocation as well. If things continue their current path I most likely will be 30%+ in cash by year end. If I do this, I am thinking that my portfolio will bubble somewhere around 30% cash, 20% income, 45% equities and 5% other in Morningstar's Instant Xray.
My pre 2016 plan was to raise my holdings in world equity and allocations funds and reduce some of the other equity areas but leave my overall asset allocation where it finished 2015. Now I've put my Tom Terrific hat on and begin to ponder ... So, stay tuned. Most likely I'll continue to take money from the table by accruing all fund distributions to the cash area ... and, do little buying unless there is a good downdraft in the markets.
I simply do not like the way January has opened.
Additional comment.
In checking a few of my sources I am finding a TTM P/E Ratio for the S&P 500 Index being reported at 21.5 with 2015 earnings begining the year at $102.31 and finishing it at $95.38. Folks, that is a decline of about 6.8%. Perhaps, some more downward price adjustment will be coming in the stock market.
The S&P 500 Index started the year (2016) at a reading of around 2044 and if we mark 7% off of this number this puts the Index somewhere around 1900 and back to where we were around the first part of September, 2015.
So perhaps, the markets will be in decline for awhile until as reported earnings improve and market prices respond. I think we have reached the point where it is show me the money as, I remember, some forecast had forward estimates in the mid $120's range for 2015.
That is one heck of a spread between estimates and what was actually produced.
