Bear market in stocks -- if you're invested have you panicked?

[Jingthing]

It's no secret that times are changing dramatically and quickly in the world, both politically and economically. In many ways it feels like uncharted territory and in others the same old same old (bear markets are not rare historically). 

 

I recently read that (in the US) about 40 percent of stock market investors have already panic sold in reaction to the bear market (but unclear what percentage of their holdings).  Apparently, younger people are panicking at higher rates than older people.

 

Rather than do a POLL which can only scratch the surface, I invite people to post about how they are reacting to the bear market, IF they are/were invested in stocks.

 

Details such as percentage of portfolio in stocks, in retirement accounts or not, whether you've already cashed out or not and what percentage of your stocks, or whether you intend to just ride it out, come hell or high water.

[scubascuba3]

Panic selling is usually a mistake, buy high sell low, there must be a lot of people who thought making good returns every year was easy, most caught out now.

 

If I was taking a pension drawdown now I would minimise it as much as possible as markets are down

Edited May 23, 2022 by scubascuba3

[Jingthing]

1 minute ago, scubascuba3 said:

Panic selling is usually a mistake, buy high sell low, there must be a lot of people who thought making good returns every year was easy, most caught out now

I agree. That's almost always the case. But you have to be able to wait out the storm. Bear markets are usually shorter than bull markets too. 

 

It makes sense that younger people would tend to panic more easily as they wouldn't have the life experience yet of previous bear markets.

 

Of course there is always the chance that this (or any) bear market is going to be a total meltdown. 

Edited May 23, 2022 by Jingthing

[Airalee]

11 minutes ago, Jingthing said:

Details such as percentage of portfolio in stocks, in retirement accounts or not, whether you've already cashed out or not and what percentage of your stocks, or whether you intend to just ride it out, come hell or high water.

You first

[ThailandRyan]

Many are wondering if this is not a rehash of the dot com bubble that burst with the tech stocks taking a good hit.  On top of that you have many who have watched as all of there holdings including crypto to have shrunk.  Many retiree's are feeling the pinch as far as there retirement wealth goes.  How many will be living on beans and rice is the next question.  Hope I keep making the right moves with options and puts......I could not even guess where the bottom will be......Many Bulls are waiting to reinvest what they took as a gain....

[Jingthing]

Just now, Airalee said:

You first

No.

My policy on such things is that ten others must do first, then I will do.

[Airalee]

Just now, Jingthing said:

No.

My policy on such things is that ten others must do first, then I will do.

Up to you

[dj230]

I sold end of last year and just started buying stocks again in April for long term investments after trading them for a bit in the beginning of the year, selling covered call options to hedge against all my positions, still buying on the way down.

 

Volatility is super high right now which gives a lot of opportunities for trades.

 

 

Edited May 23, 2022 by dj230

[howlee101]

I sold short in late 2020 based on my expectations on the current administration tanking the US economy....he didn't disappoint.  So my portfolio is pretty good.  

[StayinThailand2much]

Bought more stocks (too early, it turns out), but kept equities at a relatively low percentage of my overall portfolio (currently about one eighth). Keeping an eye on the daily gyrations, but not too worried, as I'm in it for the long haul.

Edited May 23, 2022 by StayinThailand2much

[1FinickyOne]

Ten others - do multiple personalities count?

 

I panicked in the earliest days of covid... when I drove into CM and there was suddenly nobody on the streets in the tourist areas...

 

Before that I was 85% invested and doing great... I am currently 85% in cash and have been that way for the last couple of years... and on that 15% invested I am down about 5-10% for the year... it is conservatively invested...

 

and since the bank pays me extremely minimal interest, you could say that I am losing to inflation, but then the strength of the dollar has me doing quite well... 

 

zippy do-dah... have a nice day

[TravelerEastWest]

I am only concerned about income so I am OK and I keep buying a small amount regularly...

[StayinThailand2much]

1 hour ago, ThailandRyan said:

Many are wondering if this is not a rehash of the dot com bubble that burst with the tech stocks taking a good hit.  On top of that you have many who have watched as all of there holdings including crypto to have shrunk. 

In my opinion, worse than the dot-com-bubble, as pretty much all assets are in decline, and much more complicated than back then. Back then it was to a large part overpriced tech stocks, but now we also have massive liquidity from fiscal measures during the pandemic, run-away inflation, a very hawkish Fed, economic troubles in China, the war in Ukraine, etc., etc.

Edited May 23, 2022 by StayinThailand2much

[Kwarium]

No reason to panic. “It’s not a loss until you sell low”, is what I’ve been told. It is a very good time to not check the brokerage account too often though! My plan is to not begin to draw down my 4-5% per year unless my balance is near an ATH. Maybe 5 years from now?

 

Good luck. Stay strong!

 

BTW- While we’re not checking actual balances, its good to play around with Monte Carlo statistical outcomes on portfolio visualizer website!

Edited May 23, 2022 by Kwarium
Add the link

[GrandPapillon]

waiting a bit before investing in the US, waiting for another 20% drop, I know pipe dream, but Putin should be deploying his nukes anytime soon now ????

 

otherwise I am back in the Thai Stock Market with the SET, a lot of bargains ????

 

[JimTripper]

Don't try to hold through a downturn. You will end up selling at the bottom. ????‍♂️

Edited May 23, 2022 by JimTripper

[pomchop]

The ultra wealthy love it when the peons get nervous and dump their stocks .  Get richer and richer over time.

Unless your portfolio is full of high risk long shots just sit tight and your horse will pick up the pace on the homestretch.

[scubascuba3]

4 hours ago, JimTripper said:

Don't try to hold through a downturn. You will end up selling at the bottom. ????‍♂️

Selling at the bottom is for dafties

[EVENKEEL]

With 401K plans you have choices to a degree but mainly I'm all in or I'm out. Too late now to pull out, riding the storm is only option for me. 

[Onerak]

My 401K is target fund 2025 which is 7% down this year. Roth IRA is high yield dividend stocks which is 6% down this year. I used to withdraw 40K every year from my 401K and stash it in 7K in Roth IRA. I will not change any portfolios. I have bought 10K iBond @9.6% and add 7K cash to my Roth IRA over the year. My plan was to start my SS in 2026 ($2900/month) but I can delay two more years and get even more ($3400.month). My expenses are 3K month and no mortgage/car payments.  If my daughter goes to medical school in Thailand how much expenses are need? After retirement I only need money for sending my daughter to medical school in Thailand and I believe I have enough. 

Edited May 23, 2022 by Onerak

[bkk6060]

Are people traders or long term investors?  Trying to time the market seems very stupid and usually ends in missing large parts of a recovery.

I have touched nothing and never will.  The last 2 years up more then 50%.  Now, down but if it diversified it averages 8-10% over time which is normal, I am very happy with that.

[Iamfalang]

Nope.   Dow 100,000.    
 

it’s already been inked in the book of the Illuminati.   Everything else is fear so they can buy more.  Every news report designed to confuse the sheep.  

[Lucky Bones]

4 hours ago, pomchop said:

The ultra wealthy love it when the peons get nervous and dump their stocks .  Get richer and richer over time.

Unless your portfolio is full of high risk long shots just sit tight and your horse will pick up the pace on the homestretch.

Correct. It is time in the market, not timing the market.

And also yes, Race 8, number 7. Put the house on it.

[sidgy]

No Panic here. When C19 devastated the markets i was roughly showing 35-40% down. Just kept on with my monthly additions. 12-18 months later I was already back to showing around 5% green in international portfolio and 10% green on SET.  With this latest bear, Im showing 10% red on international and level on SET. No Panic, i will just keep on adding, the markets will be back to a Bull way before my retirement

[JimTripper]

????

Edited May 24, 2022 by JimTripper

[scubascuba3]

A good reason not to sell the house\s and put on shares.

 

Those people who kept banging on about Crypto, where are they now?

Edited May 24, 2022 by scubascuba3

[Jingthing]

OK I'm ready to spill the beans.

Contrary to all typical mainstream financial advice for older people already retired I have no stocks in non retirement accounts (all cash) but I am fully 100 percent invested in stocks in my retirement account  Have not sold and don't intend to. I may not withdrawal anything from the account for living expenses for a year or two though. Normally I've been taking 3 percent. The stocks are diversified globally and with sectors. I guess you might say I have too much skin in the game. I am avoiding checking current balances, ha ha.

[GarryP]

6 minutes ago, Jingthing said:

OK I'm ready to spill the beans.

Contrary to all typical mainstream financial advice for older people already retired I have no stocks in non retirement accounts (all cash) but I am fully 100 percent invested in stocks in my retirement account  Have not sold and don't intend to. I may not withdrawal anything from the account for living expenses for a year or two though. Normally I've been taking 3 percent. The stocks are diversified globally and with sectors. I guess you might say I have too much skin in the game. I am avoiding checking current balances, ha ha.

I retire at the end of this year. Timing couldn't be worse for me. All this year's savings are going to be kept in cash and I'll just sit on my mutal funds, but not check them too often. Hopefully in a year or so things may get back to normal.

[ChrisP24]

This market just illustrates (again) the wisdom of having a cash reserve in retirement.   When you have a year-plus in cash/cash equivalent there is no need to sell during a market downturn, you can live off of cash reserves and wait it out.   

 

Yet it is a balance, as money held in cash is money that is not working for you, and it has only been very recently that i-bonds (a cash equivalent IMO once once you've held them for a year and can then redeem them at any time) have yielded worthwhile interest.  And there is a $10k annual purchase limit for those (yes you can do another $10k in your wife's name plus more if purchased with a tax refund, but I hadn't done either of those).  Entering 2022 I had about six months of living expenses in cash/cash equivalents, but this month I increased that to over a year, plus more that I'll put back into the market to generate ongoing income once the market finds new footing.    

 

This has also got me thinking that I was overly weighted toward growth and that the money that I put back into the market should be more focused on dividend-paying stocks and other income-generating strategies.  So that's what I'll be doing over the next several months.  But the remaining growth investments (a mix of index funds and large cap growth mutual funds) I'll just leave alone, that allocation has a ten-year-plus horizon before I plan to touch it anyway.

 

So I did sell some into the market drop that I would have just held onto had I started the year with a proper cash reserve.  But from here forward I anticipate cautious buying rather than selling.   It does hurt just a bit to log in and see balances, but I'm over it.

 

So to answer OP, right now I'm around 60% in growth stocks (mostly mutual funds), 25% in income-oriented investments and 15% in cash/cash equivalents.  The growth portion is approx. 80/20 in IRA/Roth IRA vs. taxable accounts.   The income portion is reversed 80/20 with approx.  80% of that in non-retirement accounts.  The cash portion was virtually all in non-retirement acounts, but the growth mutual funds that I sold to raise more cash were in my Roth, so now I have more cash there than outside of it.  I won't pull that out unless I have to, but if I do at least it won't trigger any taxes.

 

 

[scubascuba3]

2 minutes ago, ChrisP24 said:

This market just illustrates (again) the wisdom of having a cash reserve in retirement.   When you have a year-plus in cash/cash equivalent there is no need to sell during a market downturn, you can live off of cash reserves and wait it out.   

 

Over the recent years people have been banging on about why they use an agent for retirement extension so they can invest the 800k instead and get 10%+ annual, or other rubbish number they come up with, where are they now? how's that going?