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AMANX is up rather nicely. You did well to take profits. You have not been in it for very long, though. Expect SHORT-term gains, and the higher tax that goes with it. If you have a plan, stick to it. Then all this market-hype will not be what makes you decide to trade or sell or buy. Me? I just simply waited way too long. My "problem" is on the other side of the coin, at the other extreme.
According to your 11/8 post here you were already over 90% in cash. You sold out in 2008 because of a falling market and now you are selling because of the rising market. It appears you were really scarred by the 2008/09 bear market and have never recovered psychologically.
Reply to @bnath001: If I'm too stubborn, it seems like you're too nervous. Therefore, a professional to whom you can entrust your portfolio is essential. ESSENTIAL. Let him/her make the decisions, and you can simply watch it grow. No need to drive yourself nuts. Put your money in the hands of someone who isn't emotional about all this stuff. It's easier for them to be objective. Let them make the choices and the switches in and out of funds, or go to cash. Trust them, just the way we ALL have to trust the fund managers in those funds where we've put our money, no matter who we are. Investing is a marathon, not a sprint.
My biggest fear: Loosing the principal. Being in IT indusustry, don't know how much money I can make in the future...I don't want to loose the capital I have carefullty saved. that is the biggest concern.
I don't if I can give the reins to a professional and sleep welll.
Looks like I need to go to Himalayas and meditate for a while and think this through.
Regards...always respected opinions from this forum
bnath, if the market dropped 10% and you were only 10% in equities, how much would your total portfolio have dropped? Obviously you know the answer is 1%. Are you saying you can't handle a 1% correction when you have a 20+ year time horizon? And now that you are out of equities, when will you get back in? What's the plan Stan?
If a 1 or 2 % correction in your savings is too much to handle you probably should just be in CDs. And that is perfectly fine if that alleviates stress about your money. But you really have to look at the whole portfolio for potential loss, not just the equity exposure. That may be the greatest benefit you will get from a financial advisor.
I can't handle retirement investment myself. I have become too conservative after 2008 crash. Schwab said they would offer free advisor for anyone whose portfolio is more than 250K. May be I should call them and see what they have to suggest.
I think that's wise. But beware. Do not let him "sell you a bill of goods." If you simply say, "OK" to everything he tells you, you KNOW what will happen: you'll be invested in funds that give HIM the best kickbacks. You should always go with NO-LOAD funds. Also, check with your Adviser about "TRANSACTION FEES," too. (The FUND may be a no-load, but Schwab may charge you a fee to do X or Y or Z.) Just watch out and don't let them "milk" you for lots of fees and fine-print bullshit........ ALSO, "before you pull the trigger:" you might want to check with one or two other Financial Advisers out there. Maybe a local guy? Maybe you'll get a better deal and feel more comfortable with a local person, as opposed to the "Big Dogs" we see advertized on tv every day? Just a thought.
bnath001- For some of your safe taxable money, you should look at I-bonds. Your money is 100% safe and you also get inflation protection and tax deferral. There are not many investments that can guarantee that. If you have already accumulated a lot of money from your career you may not need much more real growth in capital. Just keeping up with inflation may be good enough.
Since you are a "tech" guy, you should check out the online firm Wealthfront as an alternative to a financial advisor. They only charge 0.25% a year management fee and zero commissions for the underlying ETF trading. Over 10% of Twitter's employees use them to manage the wealth acquired from the recent IPO.
You know, a fund is not a stock. Say that twice or thrice. You must trust the manager to be savvy about the ups and downs (and Kaiser sure has been). You must trust his reading of the market. This is not your decision to make, so to speak. 'Bubble maybe, oh, okay, I better bail.' Give him his chance and above all respect for how well he does his job.
Now, if you do not trust him, and the above does not apply in your case, then yes, get the hell out. But do not go looking for another fund, which means another manager whom you are also going to second-guess!
Comments
Regards,
Ted
It appears you were really scarred by the 2008/09 bear market and have never recovered psychologically.
http://www.mutualfundobserver.com/discussions-3/#/discussion/8897/don039t-know-where-to-invest-and-sitting-in-cash-for-a-long-time-
As I mentioned in the last post I was having positions in AMANX (about 28K).
I sold them today. This bubble talk is freaking me out.
The way I look at it is, to save 10K in a 401k account it takes almost 8-9months. To loose 10K it takes probably very short time.
thanks
nath
My biggest fear: Loosing the principal. Being in IT indusustry, don't know how much money I can make in the future...I don't want to loose the capital I have carefullty saved. that is the biggest concern.
I don't if I can give the reins to a professional and sleep welll.
Looks like I need to go to Himalayas and meditate for a while and think this through.
Regards...always respected opinions from this forum
nath
Hi nath,
I suggest that you include following the Short Takes blog along with your meditations.
http://ciovaccocapital.com/wordpress/index.php/stock-market-us/bubble-talk-rarely-if-ever-coincides-with-major-top-in-stocks/
Tony
If a 1 or 2 % correction in your savings is too much to handle you probably should just be in CDs. And that is perfectly fine if that alleviates stress about your money. But you really have to look at the whole portfolio for potential loss, not just the equity exposure. That may be the greatest benefit you will get from a financial advisor.
I can't handle retirement investment myself. I have become too conservative after 2008 crash. Schwab said they would offer free advisor for anyone whose portfolio is more than 250K. May be I should call them and see what they have to suggest.
thanks
nath
Thanks for the advise.
I will think about it.
I know savings is not just enough. Multiplication is also important.
Nath
For some of your safe taxable money, you should look at I-bonds. Your money is 100% safe and you also get inflation protection and tax deferral. There are not many investments that can guarantee that. If you have already accumulated a lot of money from your career you may not need much more real growth in capital. Just keeping up with inflation may be good enough.
Since you are a "tech" guy, you should check out the online firm Wealthfront as an alternative to a financial advisor. They only charge 0.25% a year management fee and zero commissions for the underlying ETF trading. Over 10% of Twitter's employees use them to manage the wealth acquired from the recent IPO.
http://finance.yahoo.com/blogs/michael-santoli/twitter-insiders-flock-to-high-tech--low-touch-wealth-advisor-174159109.html
Best,
George..
Greatly appreaciate your reply.
I am not much of a Tech guy working for Google/Yahoo/Twitter...I work for a Government Sponcered Enterprise (GSE) as a programmer..
Kind Regards George.
nath
Now, if you do not trust him, and the above does not apply in your case, then yes, get the hell out. But do not go looking for another fund, which means another manager whom you are also going to second-guess!
Makes lot of sense in what you say.
As folks mentioned here, I will buy on dips and slowly DCA into good funds like AMANX.
thanks
nath