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As I learned the hard way with Ethereum (bought at $87, sold at $83) and Gamestop (bought at $60 and $200, sold at $50), panicking is the easiest way to lose your money when investing. Thankfully it wasn't too expensive of a lesson, but I'm now done gambling and stick with buying ETFs that track the stock market.

It wasn't the panicking that lost you money.

Ethereum is now at $1,328, 15x what I paid for it four years ago. $GME went back up after I sold. Neither purchase would have been a loss if I had held through paper losses.

Hindsight. You couldn’t have known at the time.

You weren't investing. You were gambling.

Gamestop? Come on.

There's no difference between investing and trading for the average retail stock market dabbler. Anytime you trade money for a stock, you are speculating that the asset will go in the direction you want, mostly up. If someone is looking through financial statements and has intimate knowledge of the industry, more power to you since you are more likely to be the classical definition of an investor.

I can give you loads and loads of examples where you could have held and suffered much greater losses over time. Last year I "invested" in $FSLY. Look at the stock performance. It would need to go up 900% to get back to its 2021 peak. Can it happen? Sure. Would you buy the stock thinking it could do a 900%?

Yep, I feel lucky I experimented with bitcoin around 5-10 years ago. Its cycles are short so I got a much more intuitive understanding of timing vs buy-and-hold and how to avoid panicking, which has helped a lot now.

Easy come, easy go. We made great returns since 2008 for doing absolutely zero work except buying index funds and letting it ride. Nothing goes up forever, we'll probably give more back in the next 12 months, or not, nobody knows and that is beautiful.

Unfortunately for me, I got my first retirement account about a year ago. At least I managed to buy my first house before the market went totally bananas.

I have to say: hats off to you, Sir! The whole buy-and-hold thing, while technically simple, is really hard psychologically — and that’s when you have to deal with only your inner demons, fears, and greed.

Having a close relative, and one that many people look up to, actively „sabotaging“* your resolution, is really next level!

*) I know your father only wants the best for you and this is in no way meant as an attack.

> The whole buy-and-hold thing, while technically simple, is really hard psychologically

It's easy(er) if you never log into your account(s). I haven't gone in since January when I topped up by TFSA (~Canadian IRA), and my retirement account (RRSP ~ 401(k)) is automatically deducted from my chequeing account.

I have no idea if I'm up or down and by how much.

Great job sticking to your investment principles. Every investor needs a 'Ulysses pact' that ties them to the ship to prevent the sirens from eating them.

It sounds like your account is mostly taxable, have you ever considered getting your 3-fund exposure through a '90/60' fund like NTSX? The fund uses bond futures to get the increased exposure. It also has some tax efficiencies vs bond etfs. There is a US (NTSX) and International (NTSI) version.

You could allocate 2/3 of the portfolio to NTSX/NTSI to achieve a 60/40 and then have the rest for either opportunistic market timing/security selection ("dry powder") or as an allocation to alternative beta (say something like managed futures, MLPs, private businesses, etc.)

Obviously, taxes are a primary consideration, but I find these types of funds interesting in theory!

I am generally not interested in taking more risk (I’m not saying your fund has more exposure to risk, I haven’t checked), and for the bonds part of my taxable portfolio I invest in diversified muni funds, VWIUX specifically. At the current SEC yield of 3.2% and my marginal tax rate of 40.8% this implies a tax-equivalent yield of 5.4%, which is good enough in my books.

Totally, understand what you are saying and I think you will have success. I'm not saying to necessarily take more risk, I am saying to use 2/3 of capital to get access to tax efficient 60/40 exposure. Then I would look to further diversify. Whether it's munis to capture credit risk premiums, managed futures for commodity risk premiums, or taleb-style option trading for tail risk premiums. I think these simple liquid alternative funds could improve risk adjusted returns for boglehead style X-fund investors and not increase complexity or break the investment philosophy. Happy investing.

800k down and 11% loss. Was your portfolio 8 million at the start of the year?

800k is 11 % of ~7.272 million, so no it wasn't 8 mill.

How can it be any of those?

I said my net worth is down 11% from last year, and my YTD portfolio return is roughly -21% or $800k.

My bad. I assumed they only messed up the math, not everything. 00k is 21% of ~3.8mm, which, coincidentally, is also about the size of my portfolio in the public market prior to the big tastefest. Congrats on being financiall secure everywhere except San Francisco, Singapore, central London and maybe Hong Kong.

This is smart and obvious but I need to be reminded of it. I am down barely 10% of what you are but still panic every few weeks.

Dollar cost averaging is my favorite strategy. No anticipation of risk, no timing the market. Just gains all the way up.

If it sounds too good to be true...

good for you. you're the tupe of person who would listen to my advice on wealth management.

tax implications, asset diversification, ebbs and flows of markets, etc. all things that can be rationally discussed from a risk management perspective. wealth management strategies that are reactive? eep

I could have written a nearly identical comment. Stay with your plan and good luck!

And this is how you get wealthy. Hold tight and play the long game.

He's already wealthy by the sounds of it.nl Pretty easy to be chill when even if your pot gets halved you're still rich.

Man, you're not one of those hopeless souls that "don't know anything and can't risk timing the market" your folks do seem to have a clue

Timing the market is almost always a bad idea. If he had sold in March 2020, he almost certainly would not have bought back in until the market picked up again, losing out on a lot of market gains.

I think it's somewhat possible to time the markets given monetary policy.

Monetary policy and stimulus during COVID caused a currency devaluation. If nothing else changes, the value of assets should increase, relative to a currency.

The same thing happened with monetary policy in March 2022. Interest rates went up, stocks went down.

I'm curious what others think.

It's not possible, because monetary policy tends to be a lagging indicator of recessions [1] whereas the stock market is a leading indicator of recessions [2]. Also, there's the problem that dropping the interest rate doesn't mean the Fed will continue to drop it to zero. Similarly increasing the interest rate doesn't mean the Fed will continue to increase it until we hit a recession. The predictive power provided by such a lagging indicator combined with an imperfect correlation means that monetary policy alone isn't enough to time the market.

[1] https://fred.stlouisfed.org/series/INTDSRUSM193N

[2] https://fred.stlouisfed.org/series/NASDAQCOM

It's easy to time the market when you know exactly what happened and have an explanation why it happened :P

I think it's fine to try to "time the market" and/or do many other things.

But don't do it with more than 5-10% of your savings on one assumption/prediction.

Is that the case? Recessions are “normal” (in that it’s not a once in a life time experience), and I thought the best practice for long-term investments was to 1. Keep them invested permanently, at least until you’re close to needing them, and 2. Buy low, sell high.

Under either of those, now is not a good time to sell. The only reason it would be a good time to sell is if the economy never recovers… now that would be a once in a lifetime experience.

This all operating under the assumption you don’t actually need the cash in the near future if you have enough liquid to cover a few months of no income.

While recessions are normal, I don't think this one will be. There are some major changes happening in the world that are permanent. For instance, the Brookings Institute estimates that Long Covid has already taken up to 4 million Americans out of the workforce. If we continue at that pace (~2M a year), then by 2025 we'll have 5% of our workforce too disabled to work, and many more workers impacted by reduced functionality, or by caretaking responsibilities.

In this sense it will be much different from your average recession. Add to that the other demographic changes as Baby Boomers age out of the workforce, and we're going to have a labor shortage for the next several decades at least.

Some people with Long Covid can still work, but their brain fog makes them unable to work in their former capacity. So any job that involves a very high-functioning brain -- from coding to surgery to piloting an aircraft -- may become extremely hard to fill as time goes on.

Everyone is entitled to their own opinion, but there are a lot of assumptions baked into your analysis. Particularly, around long covid recovery times and that trend continuing. Also, what percentage of that cohort makes up “skilled labor”? I hate the term, but you get the idea…

You're right, I'm making a lot of assumptions. OP asked each person for their opinion, not a crystal ball with 100% accuracy, I gave mine.

That said, I've been a reluctant member of the disability community for several decades, and I can also state that ME/CFS has a heckuva lot of overlap with Long Covid. The disabled community has called a lot of the things that have happened this entire pandemic, while 'experts' have gotten a lot of things wrong. I'm telling you what all the disabled people, who have been right this entire time, are saying: a lot of businesses are on the verge of collapse, because of long covid and other covid-related reasons (like, getting burned out from getting covid 3 times a year).

Go to a subreddit for nurses and see how things really are. Go to a subreddit for teachers. Our hospitals are going to collapse, I predict in a few years, if we don't change course. Our schools are going to buckle under this strain. How functional is an economy with a 36 hour wait to get in the ER and terrible educational options? What happens when all the flight attendants, teachers, nurses, doctors, bus drivers, waiters, cooks, and so on either get too sick or too burnt out and quit en masse?

That's why I'm saying it's not just "a recession," it's that plus...a whole lot of other huge economic issues.

I understand if you think this makes me sound alarmist. But, FYI, when I lived in NYC and I warned that our laissez faire attitude to the air at Ground Zero was going to give thousands of people cancer, I was also called alarmist.

As Sarah Kendzior says, it's a sin to be right too early.

"Go to a subreddit for nurses and see how things really are. Go to a subreddit for teachers."

Go out, in real life and you'll see that it is not that bad as media, full of emotions and sensations, told you.

FYI, telling a disabled person to get out more is not a great look.

That said, the places I do get out to -- medical facilities -- are the places I've been talking about. In the red state I used to live in, I saw tons of unmasked or poorly-masked healthcare workers, many of whom had had covid. In the blue state I now live in, healthcare facilities are understaffed, and it's only getting worse.

I repeat: if the question is about how to profit (or at least not lose) in the upcoming economic climate, one way to do that is to understand that healthcare, transit, education, and other in-person workforces will be severely stressed. I don't know how to make money on that, but at least you have the full picture.

Where are you living? Sorry about that, but disabled or not, it doesn't change whats going on in real life.

What is wrong with unmasked healthcare workers?

The latest studies show that being vaccinated only reduces the risk of Long Covid by something like 20%. So while the vaccine is good for reducing acute sequelae -- much less hospitalization -- it's not doing that much for the folks who have a seemingly mild case, feel fine after a couple weeks, go back to work....and then 3 months down the line they start feeling awful.

Brain scans of folks with Long Covid are showing brain shrinkage. PET scans are showing many areas of the brain affected.

The only prevention for Long Covid is not getting Covid, and that's still mostly achieved the old-fashioned way with a combination of high-quality masks, ventilation, and air fitration.

The Texas Infectious Disease clinic has been using elastomeric respirators for years with their TB patients -- that's honestly the standard all healthcare workers should be using right now.

You shouldn't apply collective rules for everyone. For most people, covid is no threat. If you are in risk group, I'm sure that you can individually make arrangements about masking, etc.

Btw, long covid could be a consequence of lock-downs and interruption of social contacts that we never had in history. Anxiety, reduction of movement, less working, increased consumption of fear spreading news and amount of time a front of screen... But sure, you can blame virus if you want. Or experimental vaccines.

Thank you for asking a question about Long Covid recovery times. This article goes into more detail than I can in just one post: https://www.theatlantic.com/health/archive/2022/09/mecfs-chr...

But the TL;DR is: - Long Covid is for many sufferers, MECFS plus some extra issues like breathing problems and organ damage - MECFS is one of the most disabling illnesses out there, with some of the least-good treatment options - Some folks with either illness improve with time, but many do not, especially because there really aren't treatments right now except for rest - The level of brain fog is so severe people often become aphasic and disoriented. So it's not only that brain surgeons will have to stop doing surgery. It's that people working at an ice cream shop may not be able to count change. Severity varies by individual of course.

And finally, at the beginning of the pandemic we were hearing about the concept of "hybrid immunity" -- that basically, getting covid was good for you, because it made you extra immune to getting it again.

As time has gone on though, it appears the opposite is true. Each infection has the potential to age / deplete T cells, making a person less immune not only to another round of Covid, but to a variety of infections. So a lot of mild diseases that maybe before were kept in check and had an R0 of .95 will, with a more immune-compromised populace, turn into having an R0 of 1.15 or something. People in general will be sicker, longer, than before, with a variety of ailments, because Covid is harming their immune systems.

> While recessions are normal, I don't think this one will be.

So this time it's different? You may be interested in the book This Time Is Different: Eight Centuries of Financial Folly:

> Throughout history, rich and poor countries alike have been lending, borrowing, crashing--and recovering--their way through an extraordinary range of financial crises. Each time, the experts have chimed, "this time is different"--claiming that the old rules of valuation no longer apply and that the new situation bears little similarity to past disasters.

* https://www.goodreads.com/book/show/6372440-this-time-is-dif...

Sometimes things happen that change dynamics for generations or longer. The Black Plague changed worker-employer dynamics because of the shortage of workers. Software has made plenty of professions obsolete. etc.

In this particular time, there are in my opinion some extra gnarly risks that most people aren't talking about.