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The Days of Set-and-Forget Investing Just Ended for Many Americans / WSJ
Extended Excerpt from The Wall Street Journal March 18, 2025
For years, Yoram Ariely hadn’t touched most of his investments, preferring to ride the stock market’s ups and downs. Last Tuesday, he decided he had enough.The 82-year-old unloaded almost half of his stock investments, fearful of the effects of President Trump’s economic agenda, and tariffs in particular. He may get rid of more still. “The decisions are changing daily,” said Ariely, a retired business owner in Longboat Key, Fla. The Trump administration’s chaotic mix of tariffs and government budget cuts have jolted legions of everyday investors, leading them to question the assumption that they should buy and hold stocks on autopilot.
The S&P 500, which had been delivering hard-to-beat gains, fell into correction territory this past week, with Wall Street fretting that the economy is sliding toward recession. In the first half of March, individual investors have been trading in their 401(k)s at more than four times the normal level, according to record-keeper Alight Solutions. The past month has had the most trading in almost five years. Investors who have dumped U.S. stocks say they are searching for stability in money-market funds, short-term bonds, gold and international markets. European defense stocks have been a popular bet, premised on increased security spending in the region.
I'm still buy-and-hold, but now with some limitation-bands I keep an eye on. I'm no trader. Like others, I've been growing my MMkt fund, and stocks are not the majority of my portfolio any longer. The turmoil is hard to take, but my homework keeps me pretty steady with confidence---though not optimism lately. i try to learn from my mistakes, too. That way, I'll make fewer of them.
I'm still buy-and-hold, but now with some limitation-bands I keep an eye on. I'm no trader. Like others, I've been growing my MMkt fund, and stocks are not the majority of my portfolio any longer. The turmoil is hard to take, but my homework keeps me pretty steady with confidence---though not optimism lately. i try to learn from my mistakes, too. That way, I'll make fewer of them.
I’ve got 5 major holdings, 4 consisting of a single fund in which I have a high degree of confidence. The 5th is a conglomeration of CEFs as I’ve discussed elsewhere. It is very rare for me to sell / swap out any of these major holdings. The one thing that precipitates a sale is if I think a holding has outperformed strongly over a short time frame (1-3 years). I will sell it and buy something less expensive. Sold PRPFX for that reason 6+ months ago.
My emotional reactions to markets in general can best be handled by slight upticks or down-ticks in the % allocated to cash. 10% is normal. Currently it is at 12%. Might indicate caution, but it’s also related to some very substantial anticipated withdrawals for home infrastructure projects within the next year.
Comments
My emotional reactions to markets in general can best be handled by slight upticks or down-ticks in the % allocated to cash. 10% is normal. Currently it is at 12%. Might indicate caution, but it’s also related to some very substantial anticipated withdrawals for home infrastructure projects within the next year.