Been lurking here for a few days to try and figure out how best to proceed in light of recent events. I’m as basic as it gets as far as investing goes. I have a 401k that I’m contributing to at the max level matched by my employer, which is about what I can feasibly afford to set aside. Up until this point I’ve been incredibly hands-off, allowing my contributions to go into a targeted fund which is currently heavily weighted in stocks as I’m still a ways off from retirement.
I generally agree with the overwhelming consensus of this sub that says to not try to time the market and just ignore the news, keep plugging away through the ups and downs yada yada because nobody can truly predict the market.
However (and here’s where I’m sure I’ll be mocked and downvoted), it seems like that conventional wisdom was established *before* we had a president who would do things like announce that he’s going to tank the US stock market on a specific date. That feels like a key factor worth making a small exception to the conventional wisdom, does it not?
Yesterday, I simply moved my current holdings from the targeted fund, into short term bonds (75%) and a money market fund (25%). I’m not married to any of these percentages, that’s just what felt right based on my very limited knowledge. Please chime in if you have a better suggestion. Most importantly, my future contributions will continue to go into the targeted fund buying up these increasingly cheap shares. I’m not running away, I’m just trying to preserve what I’ve already accumulated in the face of certain destruction.
Now, obviously timing the drop was the easy part, they announced it. And I don’t have near the hubris to think I’ll be able to accurately predict where the bottom is. But I don’t really need to do I? As long as I move everything back in at some point between now and when the market eventually rallies above the position I sold at yesterday, I’ll have ended with more shares than I would have had I just ridden it out. Hell, I could move everything back in right now and I would be *slightly* better off.
I’m still mulling over how to proceed having mostly avoided this initial drop. I’m thinking of maybe moving it back in 10% at a time over the next few weeks or months rather than try to choose one “ideal” moment. Open to suggestions there. Yes, I know it’s a long game and moves like this are somewhat trivial in the grand scheme of a 30+ year retirement fund but still…Ignoring a blatant certainty that the market is going to tank on a specific day when there are very simple ways to minimize my exposure, just seemed unnecessarily rigid.
Roast away