[gonzo]

DOW 24,272
Tick tock

[DETRoadster]

Originally Posted by gonzo

DOW 24,272
Tick tock

It's crazy, right? I mean dont get me wrong I love a success story but man it makes me nervous. When's the party over? 25K? 27K? And what will trigger the correction? Got any theories, Gonzo?

[Matt@EuroJerks]

Originally Posted by DETRoadster

I know, right?

Spreading my risk. My guys are paid a straight percentage so while that keeps them honest with respect to what investments they pick, it also incentivizes them to grab the largest slice of my investment funds possible. So I always take that into consideration. They have about 50% of my total portfolio and are itching to get their hands on a nice little chunk that I have poorly invested in some annuity BS my last advisor steered me in to 7 years ago. I'm considering moving that and trying to figure out where. Hence all the questions here.

I am in the business. My opinion is that it's more beneficial to give them most if not all and let them work for you. It will be more advantageous to your total cost (more assets, better rates, and ability to leverage management to reduce fees) as well as value added they can provide because they see the whole picture. If they are worth their weight they will provide a total financial plan that you are comfortable with as well as legacy planning for your kids (insurance and trusts). I find when you have different brokers then you have too much overlap and get hurt in the down times.

Just a thought.

[Matt@EuroJerks]

Originally Posted by funbobbyrob

There are products for accredited investors via any major bank wealth manager that have capital preservation (0% return as max downside) and participation for market upside. Some have caps and others may not that still offer liquidity. Also there are ‘rich man’s Roth’ products via IUL insurance products with similar mechanics with other tax benefits on the accumulation. These products rely on options not just equities to limit downside risk while still getting upside.

We call them structured investments.

[BayMoWe335]

Originally Posted by DETRoadster

It's crazy, right? I mean dont get me wrong I love a success story but man it makes me nervous. When's the party over? 25K? 27K? And what will trigger the correction? Got any theories, Gonzo?

The Dow could go to 40,000 before any correction or sideways for 5 years.

No one knows. Keep buying low cost index funds for a lifetime. You be a multimillionaire.

[DETRoadster]

Originally Posted by Matt@EuroJerks

I am in the business. My opinion is that it's more beneficial to give them most if not all and let them work for you. It will be more advantageous to your total cost (more assets, better rates, and ability to leverage management to reduce fees) as well as value added they can provide because they see the whole picture. If they are worth their weight they will provide a total financial plan that you are comfortable with as well as legacy planning for your kids (insurance and trusts). I find when you have different brokers then you have too much overlap and get hurt in the down times.

Just a thought.

Good points there. Thank you!

I discovered that what I thought was an annuity (as sold by my last broker) is nothing more than an unmanaged fund with a mix of equities and bonds. A "set it and forget it" sort of deal. Shame on me for not being more involved and trusting him. The good news is that I dont need a broker to make any changes I want. i can move some or all of the funds into any of their 200 or so accounts. They offer access to some Vanguard funds that look pretty good.

I hear you though on the idea of keeping the funds under one roof so that they can manage my who portfolio, leverage buying power, and get discounted fees. I just dropped into a lower fee structure with Baird so I have a loooong way to go till the next break.

Did some research on structured investments. So it kinda sounds too good to be true. What' the downside or risk? Why doesn't everyone do these?

[ipilcher]

Originally Posted by other_evolved

For the majority of investors, funds/ETF's are the way to go. If you're trying to buy individual bonds here and there through a brokerage account, you're likely getting hammered on pricing. One could get much broader exposure at a pretty cheap price and have the benefit of next day liquidity.

I don't like bond funds, because they can't be held to maturity, so you're going to be stuck taking a big NAV hit when interest rates rise.

So once again, individual investors are screwed.

[bimmer456]

So the month closed yesterday and I'm up from the previous month. Just not by as much as I was earlier in the month. Hardly what I'd consider a crash. I'd say this isn't a bad month.

[DETRoadster]

Originally Posted by ipilcher

I don't like bond funds, because they can't be held to maturity, so you're going to be stuck taking a big NAV hit when interest rates rise.

So once again, individual investors are screwed.

Can you explain further? What's a "NAV" hit?

[DETRoadster]

Originally Posted by bimmer456

So the month closed yesterday and I'm up from the previous month. Just not by as much as I was earlier in the month. Hardly what I'd consider a crash. I'd say this isn't a bad month.

Not a crash at all. I was just being cheeky in the title of the thread. The crash will come, but not last month.

I agree, not a bad month overall. I'm up just a hair under 3% across the board for November.

[bimmerfrk]

moved entire 401k into treasuries..... Let it crash...

[rad doc]

Originally Posted by bimmerfrk

moved entire 401k into treasuries..... Let it crash...

Why? You have some great knowledge?

"Far more money has been lost by investors preparing for corrections, or trying to anticipate corrections, than has been lost in corrections themselves." Peter Lynch

[qba335i]

Originally Posted by DETRoadster

Good points there. Thank you!

I discovered that what I thought was an annuity (as sold by my last broker) is nothing more than an unmanaged fund with a mix of equities and bonds. A "set it and forget it" sort of deal. Shame on me for not being more involved and trusting him. The good news is that I dont need a broker to make any changes I want. i can move some or all of the funds into any of their 200 or so accounts. They offer access to some Vanguard funds that look pretty good.

I hear you though on the idea of keeping the funds under one roof so that they can manage my who portfolio, leverage buying power, and get discounted fees. I just dropped into a lower fee structure with Baird so I have a loooong way to go till the next break.

Did some research on structured investments. So it kinda sounds too good to be true. What' the downside or risk? Why doesn't everyone do these?

- issuer default risk
- fees
- not tax efficient
- usually have caps on max gain %

Having a well diversified portfolio is more beneficial over the long term. The only free lunch in finance is diversification.

For a typical investor it makes more sense to have 1 portfolio manager. They will be able to manage assets more effectively and be able to offer different products depending on the portfolio size (separately managed account, alternatives...). You will save some money on fees as many have a tiered fee schedule.

[BayMoWe335]

Originally Posted by bimmerfrk

moved entire 401k into treasuries..... Let it crash...

You might end up right, but no way of knowing. Probably not a good call if you’re a long term investor.

[c1pher]

Originally Posted by Deep_Blue

That's still market timing - betting that the low point of the dump will be lower than the high point today. Who knows how much growth will happen between then and now that a drop in the market may or may not draw back?

That’s why you’re always buying.....dollar cost averaging.

[bimmer456]

Originally Posted by MGM135is

ThatÂ’s why youÂ’re always buying.....dollar cost averaging.

I used to try to guess the high and low point but gave up on that since it's been nothing but high points for the past year at least.

[c1pher]

Originally Posted by bimmer456

I used to try to guess the high and low point but gave up on that since it's been nothing but high points for the past year at least.

That’s what I mean. If you spend $1,000 month investing, you buy more shares when things are cheap and fewer when shares are too high.

[fbsm]

Originally Posted by BayMoWe335

You might end up right, but no way of knowing. Probably not a good call if you’re a long term investor.

If US corp tax rate cuts go through then I wouldnt expect any correction for the remainder of this presidents term

[bimmer456]

Originally Posted by MGM135is

That’s what I mean. If you spend $1,000 month investing, you buy more shares when things are cheap and fewer when shares are too high.

It's been "too high" for a long time so would you stop buying shares if it is at an all time high every week?

[c1pher]

Yep, if you are investing for long term and reinvesting dividends. This doesn’t mean you’re buying the same stocks all the time.

[bimmer456]

Originally Posted by MGM135is

Yep, if you are investing for long term and reinvesting dividends. This doesn’t mean you’re buying the same stocks all the time.

I just keep buying all the time when I can and re-investing dividends primarily in retirement accounts where the dividends aren't taxed. If the dividends are taxed I may cash some of them out to cover the taxes.

[3798j]

Originally Posted by bimmer456

If the dividends are taxed I may cash some of them out to cover the taxes.

As a "dyed in the wool" DRPer (stock dividend reinvestment plan), I'm not understanding why you would want this approach. Even for the highest income bracket earners the tax rate on ordinary dividends is "only" 20% (and for the majority of taxpayers it's 15%). That's a bargain in in my book.