Investing Strategies. What is your move?
- Thread starter PimTac
- Start date
A healthy market should NOT have crazy swings up and down.
We know things are not good and bad news ahead….
I've only been watching (very passively at that) for the last few years. But has this not been the case for what, the last 20 years? Up and down, back and forth.
1: Gold
2: Silver
3: Beans
4: Bullets
2: Silver
3: Beans
4: Bullets
Fellow equity investors... Hundreds of millions of workers will be funding their 401K plans forever.
Rough times ahead? Perhaps, just like forever. How low and how wide? Dunno. Neither do you. Market volatility is hardly something new.
If your portfolio needs to be changed in times like this you have a lousy portfolio.
I am staying put. I am not nearly as diversified as Schwab would like me to be, but diversification is protection against significant losses.
I am probably the only mouth on this forum in fixed income. Double tax free CA Muni Bond Fund baby!
I will not tell you my portfolio's paper loss YTD. I also will not tell you my 5 year (or more) paper gain.
If you can brag about that gain you can brag about that loss...
I suggest you look at your 5 year numbers and remember, a diversified portfolio will likely reflect these times as a blip on the radar.
Good luck and manage that risk tolerance!
Rough times ahead? Perhaps, just like forever. How low and how wide? Dunno. Neither do you. Market volatility is hardly something new.
If your portfolio needs to be changed in times like this you have a lousy portfolio.
I am staying put. I am not nearly as diversified as Schwab would like me to be, but diversification is protection against significant losses.
I am probably the only mouth on this forum in fixed income. Double tax free CA Muni Bond Fund baby!
I will not tell you my portfolio's paper loss YTD. I also will not tell you my 5 year (or more) paper gain.
If you can brag about that gain you can brag about that loss...
I suggest you look at your 5 year numbers and remember, a diversified portfolio will likely reflect these times as a blip on the radar.
Good luck and manage that risk tolerance!
Todays woodshed participant is Under Armour. Down just over 8% yesterday and off more than 16% in overnight trading.
https://www.cnbc.com/quotes/UAA
https://www.cnbc.com/quotes/UAA
Something to keep an eye on.
https://komonews.com/news/nation-world/contract-talks-near-for-thousands-of-west-coast-dockworkers
https://komonews.com/news/nation-world/contract-talks-near-for-thousands-of-west-coast-dockworkers
Owen Lucas
$100 Site Donor 2023
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DCA'ing on the way down, lets just hope it's not down for another decade though!
Interest rate trends historically last a long time. Bonds (Unless TIPS or similar) go the opposite of interest rates. TBF is doing great.
Exactly. Current bonds will sell at a discount, while new bonds will have higher rates. The fund will use the proceeds to buy the new bonds, which will have a higher interest payment. Then, as rates go down, the higher rate bonds will sell at a premium.
I never think in short term. That's gambling. Bonds are known as self healing. They are not for everyone, at least as a large portion of your portfolio, but they are work for me. I have a CA Municipal Bond fund, which is double tax free. This is important to me, and the bonds are a hedge against big swings.
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I haven't had enough time to fully digest this concept but I've read it several times - bond yields aren't automatically inversely related to interest rates and they are more sensitive to rate of interest rate changes. As I said, I've had little interest in bonds until recently and so haven't fully wrapped my head around them. I understand the basics, tax advantages of muni's, and TIPs, etc but they're a little more nuanced so any help on understanding them better is appreciated.
Tax exempt for both Federal and California.
California income tax tops out at about 10%.
Double tax free can be a huge advantage in that state.
I have the GW&K California Muni Bond Fund through Schwab.
The yields (interest rates) tend to run 5%. The fund buys and sells CA municipal bonds, as you might guess.
As @Astro14 points out, double tax free can be beneficial as a tax strategy for those who pay CA income tax.
It is hard to see the increase in decent index equity funds as compared to bond returns; this strategy is not for everyone.
It is, however, a hedge against downward swings; relatively safe if there is such a thing.
As everyone knows, bond fund values have been slaughtered in Q1, making this an investor's opportunity, IMO.
The highest CA state income tax bracket is a lofty 12.3%. Making money is expensive but a great problem to have.
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I wonder how many over leveraged investors are getting Margin Calls with FAANG type stocks getting hit ?
Margin debt had been very high recently. A few months ago it hit a record high.
Some folks went crazy with margin buying near the peak.
Margin debt had been very high recently. A few months ago it hit a record high.
Some folks went crazy with margin buying near the peak.
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HUH??? If you bought a 30 year treasury bond that yielded 3% for $1000, then the new 30 year bond yields 4% that bond you bought for $1000 is now probably worth $800 or so. That is how bonds work. When interest rates fall the value of an existing bond becomes greater ( beware that commercial bonds are callable, and corporations will recall their bonds if they can float new ones cheaper). Treasury bonds are not callable.
Yeah, I know, and I know for someone just buying bonds it’s that simple - I’m trying to understand the secondary market and WHY yield curves do what they do. It’s not always as simple as interest rates go up and bond prices fall. As I said this maybe the simple way of looking at it but I’ve read several times the rate (how quickly) of increase or decrease in interest rates is more important than just interest rates went up or down in determining bond pricing.
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