Shaking in my boots

This topic contains 20 replies, has 4 voices, and was last updated by  Anne 3 years, 3 months ago.

Viewing 21 posts - 1 through 21 (of 21 total)
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  • #17879

    B.T.NIPP

    Is everyone holding strong in the C, S and I? I was thinking I may have missed a allocation change update?

    #17887

    TS Paul
    Keymaster

    For what it is worth, I am staying right where I am. This is a global reaction to some of the air being let out of the Chinese market bubble. I don’t see it getting a lot worse, although it will likely continue tomorrow (traders don’t like to hold positions over the weekend, especially when things are as volatile as they are right now) and it could certainly continue for a few more days into next week. I won’t get nervous unless the losing streak stretches well beyond where we are now.

    Good luck to all of us.

    The TSP Allocation Guide www.TSPallocation.com

    #17893

    Keith

    For what it’s worth, some elliott wave strategists see this decline going until the 1840s on the S&P 500 before the corresponding rally back to new highs starts.

    I’m likely to see if that target gets hit before making any allocation changes myself.

    #18110

    Anne
    Participant

    Keith…S&P did trade as low as 1,812.29 intraday, closing January 20 at $1,859.33. January’s beginning was brutal and any rally back to new highs seems unlikely in the near term. Close on Friday was $1,880.05 for S&P 500

    To me, it seems like the economy is weakening. Although job growth was positive, it is lower than expectations, affecting the markets negatively. There seems to be more negatives like lower expected earnings across the markets.

    Interesting chart on relation of $SPX to oil I found interesting on another forum: http://stockcharts.com/h-sc/ui?s=%21WTIC&p=D&yr=1&mn=0&dy=0&id=p78613932462&a=443616393

    #18113

    Anne
    Participant
    #18133

    Kristopher

    I don’t think there is any drought we are heading into a rescission in the next 12-24 months. The S fun is down over 20% since its high, $39.33 on 6/23/15, that is more than a correction.

    The only question is if there will be a short rally in the near term before the bottom falls out even more. We are all running for safety in either the F or C funds but is it worth waiting to see if a small rally happens a the S fund hits maybe $34 a share before we switch to the F fund or C fund.

    In reality the ones who “panicked” on the first 10% correction in August where the smart ones. They sold their S shares around $36 and C shares around $27. Maybe I am wrong but I don’t think we will see the S fund at $36 again for a long time.

    I am still following TS Paul as I believe his methods are truly sound but I don’t think you can time even a recession. By the time you see the signs, its too late.

    #18134

    Bruin79

    I’m going to hold steady at 80 percent C and 20 percent in S fund, as much as I want to move it all to the G fund, I would be loosing too much money if I switched now and miss the upswing whenever that might happen, kind of a catch 20 – 20.

    #18136

    Jes

    Well, as I watch the Dow and the S&P plummet today, here I wonder how much more losses can I sustain. I’m currently down 16% in the C fund since November. This is not a correction. Sounds like something more ominous.. Love to hear from the group..

    #18137

    Rolfeskj

    Jes,

    I do think it’s more but with loses already locked in it would be hard to go to the F fund now. I mean 50% of the experts say the S&P will be up by years end. So you would just lock in your losses. But the other 50% of the experts say this is just the start and the world economy will bring down the slowing US economy. So if you believe them put all your money in F now before it gets worse.

    #18138

    Jes

    My first instinct is to leave the money in C fund and try and recover some of the losses. But the market itself dictates otherwise, IMO. I have very little confidence it would go up 16% by the year’s end thus allowing for a recovery. My stock market uneducated gut tells me it’s going to go further down.. Thanks for your reply..

    #18139

    Anne
    Participant

    There’s much uncertainty. I think market is going to get worse before it gets better although a bounce is possible I don’t foresee any decent rally in the near future. I reduced my stock position to 40%. I reduced my position in F Fund slightly as AGG is within 2% of it’s 52 week high and not sure what the FED is going to do or say this week, which often brings on a short term knee jerk reaction from the market.

    S&P 500 was below 1850 support for most of the day, closing at 1,853.44 Range: 1,828.46 Low – 1,873.25 High, if it goes lower, next support is at 1700 level. Online, you can find articles that support either a rally or plunge by a certain date in the future, but negatives seem to be much more prevalent at the moment.
    http://www.reuters.com/video/2016/02/08/sp-500-could-plunge-to-1700s-strategist?videoId=367331003

    I’m down 6-7% for 2016 because I didn’t move soon enough to safer territory. If it falls to 1700, that would be an additional 8% loss. Being close to retirement, I’m a little more cautious as it is feeling like we may be going towards recessionary period.

    #18142

    Kristopher

    Anne,

    Currently I am 65% in C and 35% in S. I wont be touching the money for another 20 years so losses right now are not a huge deal but if I can preserve my balance on down turns I will be a lot better off in the end.

    This month I will be moving my last 35% of S out into either the C fund or the F fund. I am just worried if I move it to the F fund I will miss a bounce and be down a ton of money. But then again every time I think the market cant get any lower it just drops more. Any thoughts from anyone?

    #18143

    12squared
    Participant

    Don’t move from S to C right now. The S fund is down 15-20% points more than C fund over the past 6-12 months. To put it another way, the price ratio (aka relative strength) of S:C is currently about 120%. Back in September it was 135% and nearly 140% in March 2015. On the contrary, wait until the S/C ratio begin to rise again; then move from C to S.

    #18144

    Kristopher

    12squared,

    I know the ratio does keep dropping and I have been keeping an eye on it. The only problem is that if this turns into a full blow recession before the ratio of S and C gets back over 135% then I will ride my stocks all the way down.

    Back in 2008 the ratio of S to C was 108% on 11/20/08. I don’t want to wait to see if we get back to that point because I would then have wished I would have went from S to C at 120%.

    Plus you also need to look at the ratios to the F/G funds. If the timing was right you can leverage the swings from S to F at a much higher rate of return than you can S to C fund.

    But the problem is my timing is never right. If it was I would have switched to the F fund this summer and not be in the poor position I am in now.

    Its just scary to see how fast the S fund is dropping, $35.80 on 12/28/15 and in less than 40 days we are looking to be under $30 a share. That is almost a 16% drop plus the 10% or so drop from the Falls “correction”.

    It seems a lot like 2008, when the S fund dropped this fast.

    #18145

    Jes

    After this afternoon’s down turn I’ve had enough. Im going from C 100% to G 100%. I could’ve waited but my strategy at this point is to protect my balance against any further losses. Nothing this year has given me any confidence this market will reward me any time soon if I ride this terrible storm. I’m ok with riding a correction, but lets face it, this is not your normal “correction.” Down 18% since August. I’ll wait until the market starts to show signs of recovering and then will move accordingly. If I miss any upticks then so be it. I have a couple of more years to recover it. But again, this looks like it will get worse before it gets better. If I only had a crystal ball……

    #18147

    12squared
    Participant

    Jes,

    If you go to G now, what is your re-entry price to C, S or I? How will you determine when the storm is over?

    #18148

    Jes

    12squared

    I don’t yet have a return entry point price. But I will look for a sustained period of gains along with a more positive overall market sentiment. I really don’t like to split hairs in the stock market, nor do I have the technical knowledge to do so. I will add, since I reallocated to G during this afternoon, I will closely watch the market up until before noon tomorrow and will either leave it in G or reconsider. My impulse is to protect my funds from any further losses as I am 3 to 4 years from tapping into the TSP.

    #18149

    Anne
    Participant

    Kristopher, you may want to consider G instead of F until there is clear direction to what the Fed may do and how the markets may react. I think they have some type of announcement tomorrow. I agree that you are better off if you can preserve your capital in downturns after riding out the last recession. But as the last recession showed, you still have some market risk in the F Fund. With the Fed researching possibility of negative interest rates, monitoring economic condition to see if they will proceed with their planned increases, and the markets knee jerk reaction to almost everything these days, I don’t have a clue what to expect.

    12 Square, The S Fund has been in a bear market for awhile while C fund isn’t quite there yet. Any stock fund has risk that you have to balance against potential reward. I left 2% in S Fund with my last Inter Fund Transfer, as that’s all I’m willing to risk at the moment–I attribute my losses to the Government’s 5% match.

    Jes, I understand wanting to get to safety, but I’m not sure that I would move 100% all at once to G. Although I used one IFT yesterday to increase my safety. I’m waiting to see what happens before I use another one, in case I want to increase exposure to the market later in the month. Once you make 2 transfers you are severely limited in any further IFTs, but you can always move funds to G.

    If you look at your Annual TSP statement, is shows “Your Lifetime TSP Contributions” Based on my current balance my contributions account for about 36% of the total value, which I will probably maintain in G/F indefinitely. So currently I have a greater safety cushion and am comfortable with 40% being at risk in C/S/I which I can either ride out for the time being or may decide to move more to safety at some point. I am just leaving my options open for now as this market is really crazy.

    #18152

    12squared
    Participant

    Jes,
    Had you considered moving only a few years worth of withdrawals into G, instead of the whole enchilada? By doing so, you wouldn’t need to watch the market careful trying to time your re-entry price.

    Anne,
    As the TSP funds are composite indices, I am not worried about their value going to zero, as I might with an individual stock. Therefore, I try to sell in Bull and buy in Bear conditions. My definition of Bear is not based on % down from peak, but how the price compares statistically to the moving average. When the prices is following the +2 StdDev curve (or upper Bollinger bar), I’d call it a Bull market. When it follows the -2 StdDev curve, it’s a Bear.

    If I were switching into G or F, from C, S or I, I would look at price. However, if I am switching between stock indices, the relative strength is the appropriate metric. On this basis the S fund relative to C has been Bear since the 1st week of January, and all through October 2015. The Bull market for S/C ended in April 2015.

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    #18154

    Jes

    12squared

    I can assure you I won’t be trying to carefully time my reentry back into the market. Whenever the market provides me with enough reassurance that it is recovering I will come back to either C or S funds regardless of the re-entry price. I would never attempt to purposedly time the market, it’s not possible. My best indicator, as always, will be the market itself..

    #18155

    Anne
    Participant

    I’m not worried about stock funds going to $0, but I don’t want to lose over half the current value either, as it did in what some refer to as “the Great Recession.” I can’t wrap my head around the relative strength between the funds as you do 12Squared.

    In March 2009, index values got down to 1996 values
    12-Oct-07 C=17.5300 S=21.2500 I=25.840 ~High Point
    17-Sep-08 C=13.2522 S=16.7243 I=17.8556 >20% Decrease
    09-Mar-09 C= 7.8673 S= 9.0631 I=10.2903 ~Low Point

    I have no idea how low this market could go…not getting any warm fuzzy feelings at the moment, although I keep hoping for a strong bounce or rally:)

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