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How low will it go? Stock market taking a dip

  1. I think it has been looking for a reason for a correction anyway. So, a drop of 10% t 15% could actually be healthy.
     
  2. Irrational exuberance is a son of a gun.
     
  3. Sitting on the sidelines waiting to buy......
     
  4. I have absolutely no clue.

    I have enough retirement savings already in cash to last for this year (I take a couple percent out every year as part of my income), so I won’t need to sell anything for a little while.
     
  5. Lower than today.
     
  6. Two different days in Feb 2018 we had drops of over 1,000 points on each day; larger percentages than today ( so far ).
     
  7. Goldman Sachs started calling for a correction last week - right after they got their shorts in.

    https://www.cnn.com/2020/02/20/investing/goldman-sachs-stocks/index.html

    The market is up 42% over the Trump period, somewhere around 8200 points based on today being down nearly 1000 points. Sure, I'm going to take a big hit in my 401(k) but it isn't like we haven't been here before.

    Once the market realizes they have thrown the baby out with the bath water, we'll recover.
     
  8. This situation (the virus) is pretty unique. We really have not had a supply chain disruption like this before in the modern JIT (just in time) era.
     
  9. That's true and maybe it will wake up a few of the US companies. They need a backup plan! Their company should be punished (decline in stock price) for failing to have such a plan. Unfortunately, it drags the rest of us down.

    As I understand it, about 1/3 of the Chinese companies are back to work, with restrictions. We'll see!

    I would expect one of two things: The virus really takes hold and kills multiple millions of people (we won't need our 401(k)s) or it dies out in the next month or so. I can see it going either way.
     
  10. I wonder if the supply chain disruptions will just push the demand back to the 3rd or 4th quarter or if that demand just goes away
     
  11. Surely demand will recover, it's just a matter of how long it will take for supply to catch up. Supply has an upper limit.
     
  12. How low will it go? Stock market taking a dip

    Don't know. Don't care.

    The only money I ever lost was $20,000+.... in Stocks.

    I didn't know it until it was too late that the company that managed my company's 401k was playing the stock market with the money. (apparently with my company's approval).

    I thought that losing $20,000 was bad but another pilot told me that he lost $200,000 of his 401k money.

    As soon as I found out what was going on I called the 401K company and told them to get every cent of mine out of stocks.
    The 401k lady I was talking to said, "That's smart".

    I guess she was tired of telling people that thousands of dollars of their retirement money is gone.
     
  13. Down 40% from high, if that was the high.
     
  14. Not according to the graph I am looking at.
    Same true NASDAQ, S&P500, ...
     
  15. BTW, What is the stop for a single day loss? I know there is a stop to keep from having a run away, but I don't knwo what it is.
     
  16. That may be ok if you’re half way through retirement already and not spending much.

    But if you’re still in your working years not investing in stocks is a perfect way to come up short for retirement.

    The big “crash” of 2008, I just left my money where it was. Ten years later I was up 400%. It’s only been a steep uphill climb since then.

    It ALWAYS comes back, and then some. The only people who lose are the people who didn’t have time to wait for the recovery, and should have been invested differently, and the people who sold near the bottom.

    Even the Great Depression came back eventually, obviously. The only reason it took so long was because the Fed was fairly new and didn’t know what they were doing with monetary policy. As a result the did the exact OPPOSITE of what they needed to do, making the situation worse and much longer than it had to be.

    But look, everyone should follow a strategy they are comfortable with.
     
  17. It will be bad for a while, mostly because of corona virus impacts. The supply chain impacts from China are going to be felt for a while mostly because their stuff is everywhere (ironically including medical equipment needed to deal with corona virus). Hopefully you diversified any investments. If not, you may just have to hang on instead of selling at a loss.
     
  18. I’d guess a fools rally tomorrow

    then generally down until the election is clear and the perceived end to the virus is identified
     
  19. you mean 4%?
     

  20. Search "stock market circuit breaker"
     
  21. Even after today we are still way over what I consider to be fair value - if you use any historical measures.

    But of course valuations don't matter - until they do.

    Maybe the FED will cut interest rates and print a few hundred billion doses of corona virus vaccine.

    S&P500 stocks are valued 2.3X revenue -- historical average is closer to 1.5x

    PE is over 24 - historical average is around 15
     
  22. I keep my investments in guns and bullets. no worries aboot the market , anyways when I retired I will go back to my home land El Mejico!!!! my $100.00 a month will go far there.
     
  23. No, I mean a full 40% from high. Election levels 2016. Happens all the time. I wouldn’t buy anything before then.
     
  24. Be prepared not to buy stock any time when it might still have a chance to do you some good.

    The market could easily correct 20% and then go on to eventually double or triple in value.

    Remember when dow 20k was considered a high point? Lol
     
  25. every dip between 1997 and 2008 was a mistake to buy. Even 2003.

    This mkt has been on steroids for 10 yrs.

    there is no Rush.
     
  26. Good luck.
     
  27. I think the markets may be in for a rough ride until after the election and even then a lot will depend on what is happening with the coronavirus.

    I think the reality that Trump is almost a shoe-in for re-election is helping a lot. Can you imagine if the dems were actually running someone that might have a chance?
     
  28. I'm a leery investor, we start with that. You say it always comes back. Yes, the market has always bounced back. But individuals aren't invested in the whole market. Sometimes their particular stocks or funds don't make it back. I've seen that personally. So just because the market goes up (or down) doesn't mean everyone gets those same results.
    Maybe I was just unlucky or a poor picker or funds.
     
  29. That’s an understandable position to take.

    But if you’re not somebody with the experience, time, or resources to do your own picking (which is most people) you can just buy an S&P500 index fund and basically own the market. You’ll still do pretty well.

    In addition, the fees for this type of fund should be next to nothing. It’s really a great option for most.

    Another option are target date funds that automatically rebalance to be more conservative as you approach retirement. It’s a great fire and forget option for people who don’t follow the markets.
     
  30. For fooks sake. Just talked to a financial planner last week, told me to move a big chunk of my 401k from the account with 100% stock market to the one that is only 60%. Didn't do that until this morning. Hope it got in under the wire! lol
     
  31. Oh come on.

    If you are trading or trying to time the marker, some of your above comments may make sense. Otherwise unless you are very knowledgeable and involved on a daily basis it’s a recipe to lose your money.

    If you are an investor for the longer term the best advice is be diversified, hold still, think about companies that may now be undervalued that you want to own; maybe look at what has disappointed and trim.
    One thing for sure over the longer term markets go up.
    Your money / investments should be diversified anyway. Depending on your time horizon and risk tolerance say 40%- 60% Equity
    5%- 10% Cash
    ..... and the rest in Fixed Income Type Vehicles.

    No matter how $hitty you think the US market may be ( or how overvalued) it is the best game on the planet.
    Money from all over the world is looking for a safe haven and is coming here or is already here sitting on the sidelines.
    So it goes down 3-5%- 10% on Corona virus concerns. This too will pass............
     
  32. I'm just worried that if it doesn't pick back up by November the Dems will use the down market against President Trump. But it has bounced back a little bit today from the lows.
     
  33. Then I would say you are a victim of very poor investment advice. Invest in a S&P 500 no load index fund or a Total Market no load index fund and that will resolve that single stock problem. Index funds have outperformed well over 90% of the stocks and managed funds over history and is really the best way to invest. And never, ever, ever pay a load or a commission to a broker for investments.
     
  34. Don't talk like that!!! That's "HILLARY-TALK" from 4 years ago and you know what happened then! Push all the way and vote! Get off your nether region and Vote for Trump! Don't get comfortable!
     
  35. I read a very compelling article from a Wall Street guy and he said sell all your stocks, put them in bonds, and maybe, maybe, invest in some small bio and pharmaceutical companies, and those companies that deal in medical supplies and plastics. The virus requires a LOT of plastic to handle.

    He expects a rather large recession/correction that could take a long, long time to recover from. This is all new territory, as the last time this happened was 1918 Spanish flu... the stock market was minimal back then comparatively. There was no global supply chain back then, parts and materials were sourced locally.

    Going off of intuition, I moved $500,000 out of index funds last week into bonds, and so far, so good.

    I think you will continue to see a massive sell off and moving of funds to bonds and gold.

    With less demand, oil is down 4% today.
     
  36. History imply’s that election years are usually “up” years.
    Incumbents know that a driver of their re-elect is the economy and security and make sure it is so.

    We have a specific concern over a issue which is generally not understood. The market does not like uncertainty or the unknown.
     
  37. Exactly. What they sell you is that it always goes up. Well, if you bought a bunch of tech stocks in the late 90’s you had a decade of excuses. If you were retired and we’re making withdrawals you went broke. Meanwhile bonds were a great investment.

    Most people have no experience investing, taking risk, and should not be in the mkt unless their time horizon is at least 10 yrs.
     
  38. For the most part I think we agree. If you are not "in the market" handling your own investments this isn't the conversation for you.

    As far as the detail, I think we disagree.
    S&P 500 index is good, but so is the Nasdaq Index.
    US market is good, but investing in foreign markets has been very good to many. (Maybe 10%)
    The close to retirement the less aggressive. This means more bonds, less stocks. This means a dividend fund, vs. index.

    In the end, the "years to retirement" funds are not bad for those not into the market.
     
  39. A lot of effort has been put in to manipulate the stock market up to this level --

    It would surprise me if the FED and the PPT sat back and allowed any meaningful correction.
     
  40. Unfortunately, interest rates are at near record lows, despite, you know, being the best economy ever...
     
  41. Wall St is like the government, they like to make folks panic.
     
  42. Did anybody say rate cut?.............Yet.
     
  43. :headscratch:

    djiafall.PNG
     
  44. If you look at your portfolio only every 6 months, it doesn't really matter what it does on a daily or weekly basis. I have enough stress in my life!
     
  45. 401K buy and sell orders are executed at the closing price for the day.

    If you put the order in earlier today, you order was processed at today's close.
     
  46. If the Fed ever lets interest rates rise, your bond investment is screwed.
     
  47. Not if you are investing in a ladder of bonds that you hold to maturity and then reinvest.
     
  48. "I read a very compelling article from a Wall Street guy and he said sell all your stocks,"

    And pay taxes on all of those long term capital gains? No thanks.