DISQUS

The Saving Freak · 2 years ago

The attitude of the middle of a dip in stocks should be."RUN TO YOUR BROKER EVERYTHING IS ON SALE!!!"

Llama Money · 2 years ago

The author hit on a very important part - knowing when to get back in. If you're going to jump ship every time things look shaky, then you need to be prepared with the knowledge of what to look for, and when it's time to get back in. If you're not prepared for that, then just stay the course and keep your money invested intelligently.

klerg · 2 years ago

I agree with The Saving Freak. We've got a little fire sale within the stock market right now, so I say BUY.

Tim · 2 years ago

this is the problem and reason why the markets go south. people who say not to panic actually panic and sell leading markets to go south, then everyone else jumps on board. rather silly. if you continued to invest before the 2002 with a long term outlook, you would have continued to appreciate your investments. 20/20 hindsight people like to just talk about the 2002 timeframe. i switched mutual fund companies, and lucky for me, the market went south right after the cash out from the first company and stayed that way until the money was transferred to the second company.

yup, the question will always be where is the bottom and when is the market starting to go back up. i'm buying. the markets are still positive for the year.

Jeremy · 2 years ago

It's not time to sell. It WAS time to sell before the crash. I sold back then because I was fully expecting this downturn (everyone was), so I own nothing at the moment.

What it's time to do is BUY. The decline has happened. You can't accurately call the bottom; it may decline a bit more, but whereas everything was overpriced two months ago, it's not any more.

Richard · 2 years ago

Here in Canada the US stocks looked even more attractive - in the last month the US dollar hit a low of almost 90 cents and the S&P 500 dropped close to 1400 - from 3 low points in November, the gain of the S&P index in canadian dollars is 9-12% at current values. It would have been a great time to buy had I not been working on my bond allocation.

That also shows the risk of getting out when it's bad - Nov 7th was the worst price in that time period but by the 12th it gained 2%, and since Nov 26 it went up 9% for me. You would be right to think that things looked bad on those days, but getting out could lose you an average year's return within a week or two!

In general (and I probably don't need to say this here), the biggest problem with the idea of selling when things are going down, is:

1) You're selling when the price is low - or in other words, giving away money
2) If you do that you probably bought in when the prices where high - in other words, giving away money

I'm working my way up to a full portfolio, but if I was in that position I have no doubt that I would stick to my allocations and rebalance periodically or any time there's a big change, then sleep happily knowing I'm not giving away money on both ends of the deal.