Moving money around

[Appatite]

Well, I have to wonder why I ever moved money out of the C, S and I funds back in 2008. I moved money out slowely over the 2008 year as it went down in value. Then when the DOW hit about 8,000 I jumped back in 100%. The DOW went down some more but today it is over 12,000. Now in 2011, had I never moved any money out of the C, S or I funds in 2008, I would not have lost any money, and in fact, I would be well ahead of where I was expecting to be by Feb, 2011. Instead, I am still trying to make up the loss to get where I wanted to be.

So why even bother to move money around these funds? I am kind of, of the mind, to let it ride in the C, S and I funds until retirement.

 

[JTH]

Well, I have to wonder why I ever moved money out of the C, S and I funds back in 2008. I moved money out slowely over the 2008 year as it went down in value. Then when the DOW hit about 8,000 I jumped back in 100%. The DOW went down some more but today it is over 12,000. Now in 2011, had I never moved any money out of the C, S or I funds in 2008, I would not have lost any money, and in fact, I would be well ahead of where I was expecting to be by Feb, 2011. Instead, I am still trying to make up the loss to get where I wanted to be.

So why even bother to move money around these funds? I am kind of, of the mind, to let it ride in the C, S and I funds until retirement.

Coulda shoulda woulda? This is what happened to many long-term investors over the last 4 years. They sold at the bottom, then waited too long to get back in.

This not an historically typical bear market recovery, it has been compromised by the feds injection of money and suppression of failure. You had know way of knowing this would happen to the degree it has. Typical bear markets take far longer to recover. There will come a day when all this will be revealed for what it truly is, till then it's every man/woman/child for themselves, make money while you can...

 

[Boghie]

Appatite,

You did what many do. Sell low, want to buy high. You absolutely have to break that habit. The idea is to slowly bail out of frothy markets and slowly buy into crashing markets.

To me, right now, the 'F Fund' and 'S Fund' seem to be frothy. The 'F Fund' has been correcting for months, the 'S Fund' not so much.

The 'I Fund' seems to be the undervalued fund.

The 'C Fund' seems valued properly (maybe a tad overvalued, but who knows).

The 'G Fund' will be raided by the Treasury to pay Gubmint expenses while Congress wrangles over the debt ceiling. It will not affect your 'earnings' (That 1/100th of a penny per day per share) but I don't know if assets will be locked for the duration of the Stupid Attack.


But, in the end who knows.

I would have three allocations. One for good markets (now), one for normal markets (last spring), and one for bad markets (last summer). Obviously, ones for absolute crashes or absolute booms that you move to about once every decade or so. Then, shift as needed. None of the three main ones should be all in equities or all out equities - and, obviously, none should be all in bonds or all out bonds. Nobody can time a normal market. You have to let the market decide and if you ain't got nothing in a sector you ain't making any money on it. Why guess

Anyway, were you in 100% at the DOW 8000 mark? If so, don't complain. You made lots of mullah. So, you didn't make the same as the best SWAGER, but you did very well. And, if you didn't scare during some of the bumps between 8000 and 13000 you are completely good to go. You are probably doing better than 80% of everybody - even those here...

Finally, you may have saved yourself by purchasing C/S/I with your contributions if you sent enough in. Those were very juicy buys, very juicy times.

Riding C/S/I is normally a good strategy. However, you can feel frothy markets and crashing markets. Why play games with either. And, as you get closer to your Golden Years why accept as much market risk as is normal in the C/S/I? What would you be living like had your retirement been in March 2009? Not so good. You would be in an off-brand Alpo Meal Deal Retirement. Yuk. Some safety is needed as you reduce your time to recreate wealth.

Well, I have to wonder why I ever moved money out of the C, S and I funds back in 2008. I moved money out slowely over the 2008 year as it went down in value. Then when the DOW hit about 8,000 I jumped back in 100%. The DOW went down some more but today it is over 12,000. Now in 2011, had I never moved any money out of the C, S or I funds in 2008, I would not have lost any money, and in fact, I would be well ahead of where I was expecting to be by Feb, 2011. Instead, I am still trying to make up the loss to get where I wanted to be.

So why even bother to move money around these funds? I am kind of, of the mind, to let it ride in the C, S and I funds until retirement.

 

[tsptalk]

Well, I have to wonder why I ever moved money out of the C, S and I funds back in 2008. I moved money out slowely over the 2008 year as it went down in value. Then when the DOW hit about 8,000 I jumped back in 100%. The DOW went down some more but today it is over 12,000. Now in 2011, had I never moved any money out of the C, S or I funds in 2008, I would not have lost any money, and in fact, I would be well ahead of where I was expecting to be by Feb, 2011. Instead, I am still trying to make up the loss to get where I wanted to be.

So why even bother to move money around these funds? I am kind of, of the mind, to let it ride in the C, S and I funds until retirement.

Welcome Appatite. As JTH is saying Monday morning quarterbacking is easy to do and we can 2nd guess our actions, but we have to deal with the right side of the charts and no one really knows what is going to happen next.

Right now we are In a terrific bull market but with the current financial situation in American and around the world, can we be sure that in 5 or 10 years the stock indices will be higher?

Who would have thought in 2000 when the S&P 500 was pushing 1500, that we'd need a huge rally to get us back over 1300 in 2011?

Being a little more pro-active with a monthly, weekly, or even daily look at the market and the charts might help us to ask what is the market doing now? Is it moving up, or down? Is it above or below keep support lines? Are the faster moving averages above or below the slower moving averages? Etc.

Market timing is not easy, but its the folks who don't watch that are the ones surprised. The people that sell when they get their statement and find they've lost 20%, and jump back in when the market is in the headlines again because of a bull market, are the ones who are going to be hurt.

Watch for signs and turning points. It's easier said then done, but there is money to be made in markets that move sideways for 11 years, if we can but take advantage of what is happening now.

 

[Intrepid_Timer]

Well, I have to wonder why I ever moved money out of the C, S and I funds back in 2008. I moved money out slowely over the 2008 year as it went down in value. Then when the DOW hit about 8,000 I jumped back in 100%. The DOW went down some more but today it is over 12,000. Now in 2011, had I never moved any money out of the C, S or I funds in 2008, I would not have lost any money, and in fact, I would be well ahead of where I was expecting to be by Feb, 2011. Instead, I am still trying to make up the loss to get where I wanted to be.

So why even bother to move money around these funds? I am kind of, of the mind, to let it ride in the C, S and I funds until retirement.

Welcome to the board Appatite! I'm not understanding something. The DOW was around 14000 in 2007 and is now at around 12000. How would that be making money if you had stayed? I would of much preferred to have bought at 8000 like you did.

The DOW is up about 500 points since the beginning of 2000. About 4% in 10 years isn't going to satisfy that "appetite" very much in retirement. Don't give up on the trading idea....................just my opinion of course. You could always keep throwing money at it like Bernanke and Birchtree do. I personally don't have a money tree though...................

 

[Appatite]

Well, here is the point. If you look up the C, S and I funds at the height of 2007/2008 and look at the DOW which was around 14,000 and compare it to the DOW today at 12,200 you will see that the C, S and I funds are higher now. Thus if you stayed in the C, S and I funds, you'd be substantially ahead of where you thought you'd be. So if I left it alone and NOT worried about it at all, I'd have less gray hair and more money.

Just thinking out loud here but it makes me really wonder if I shouldn't just let it all ride and look back at it/tsp 20 years from now when I retire. The tsp stresses me out sometimes.

And yes I was 100% into the G fund when the DOW reached 10,000 and jumped back into C,S and I when it hit 8,000 but I am still back a good chunk o $. I don't think the DOW is a very good indicator.

 

[tsptalk]

Just thinking out loud here but it makes me really wonder if I shouldn't just let it all ride and look back at it/tsp 20 years from now when I retire. The tsp stresses me out sometimes.

I'd say it's a matter of comfort level. Revshark (the hedge fund manager that has a premium service here) caught my attention many years ago when he said he thinks buy and hold is much more risky than trading. You are at the mercy of a market that you have no control of.

He trades individual stocks so buy and hold is much more risky in that situation than say holding an index fund but still, there is no guarantee that a major index will be higher 20 years from today. Just look at Japan...

 

[Intrepid_Timer]

Well, here is the point. If you look up the C, S and I funds at the height of 2007/2008 and look at the DOW which was around 14,000 and compare it to the DOW today at 12,200 you will see that the C, S and I funds are higher now. Thus if you stayed in the C, S and I funds, you'd be substantially ahead of where you thought you'd be. So if I left it alone and NOT worried about it at all, I'd have less gray hair and more money.

Just thinking out loud here but it makes me really wonder if I shouldn't just let it all ride and look back at it/tsp 20 years from now when I retire. The tsp stresses me out sometimes.

And yes I was 100% into the G fund when the DOW reached 10,000 and jumped back into C,S and I when it hit 8,000 but I am still back a good chunk o $. I don't think the DOW is a very good indicator.

Oct 12, 2007 S fund: 21.25 C fund: 17.53
Feb 11, 2011 S fund: 22.52 C fund: 16.11

S fund return: 5.98% in 3.5 years
C fund return: -8.10% in 3.5 years

Not quite good enough of a return for me. But we each have our won desires and risk levels.

 

[Intrepid_Timer]

BTW, you don't work for the TSP do you? :blink: Just kidding............

 

[WorkFE]

I personally don't have a money tree though...................

Sorry IT. I'll check with the shipping department. I swear I told them you ordered one.:nuts:

 

[Appatite]

BTW, you don't work for the TSP do you? :blink: Just kidding............

Wouldn't that be nice. But no.

 

[Boghie]

Well, here is the point. If you look up the C, S and I funds at the height of 2007/2008 and look at the DOW which was around 14,000 and compare it to the DOW today at 12,200 you will see that the C, S and I funds are higher now. Thus if you stayed in the C, S and I funds, you'd be substantially ahead of where you thought you'd be. So if I left it alone and NOT worried about it at all, I'd have less gray hair and more money.

Just thinking out loud here but it makes me really wonder if I shouldn't just let it all ride and look back at it/tsp 20 years from now when I retire. The tsp stresses me out sometimes.

And yes I was 100% into the G fund when the DOW reached 10,000 and jumped back into C,S and I when it hit 8,000 but I am still back a good chunk o $. I don't think the DOW is a very good indicator.

Maybe there are a bunch of us starting to think this through...

I had already done some very (VERY) basic analysis of pricing for our equities funds just yesterday. Documented the high point, the low point, and a point on the fall located near our current, and of course the current. The S&P500 ('C Fund') is NOT higher than the high point. Still looking for about 9% gain to get even.

The fact that we are reaching the crashes entry point and seeing a split in personality among the funds is a good and normal thing.

Anyway...

Hopefully, BirchTree convinced you to buy heavily in C/S/I during the dump of 2008/9. He convinced me to continue buying that falling knife with ever increasing contributions. I have to say now that that may be the best investment I have EVER made in my life. But, he couldn't convince me to reallocate my exisitng holdings under that falling knife. He must have brass nads (and maybe a stone head) to risk sitting under that apple tree. Even Sir Isaac Newton would have been knocked out. Not good for science.

And, no, the DOW is not the indicator to watch. Check out the indicator(S) Tom links to from the entry page (they are on the left and listed as 'Fund Index Quotes'. I just noticed he changed a few of the indexes he is tracking. The old 'I Fund' and 'S Funds' were always a bit wierd...

 

[KevinD]

Bump [burp]