Liquidate entire portfolio until virus is over?

Prism

blue_max_3 said: 

I don't want to be the doomster, to use Boris's word But it's an opinion and equally valid as anyone else's.

The point really is that many of those that stay invested don't actually have an opinion at all - or at least one that affects if they stay invested. I have absolutely no opinion about what the markets might or might not do based upon Covid 19. It would be a pure guess if I did. I don't know where the markets will be in 10 or 20 years either but I am betting on them being higher than today

blue_max_3

Prism said:

blue_max_3 said: 

I don't want to be the doomster, to use Boris's word But it's an opinion and equally valid as anyone else's.

The point really is that many of those that stay invested don't actually have an opinion at all - or at least one that affects if they stay invested. I have absolutely no opinion about what the markets might or might not do based upon Covid 19. It would be a pure guess if I did. I don't know where the markets will be in 10 or 20 years either but I am betting on them being higher than today

That would be very likely. But the title was about being out of the market until the virus is over. If there was no virus, it would be virtually guaranteed. So, I guess we're talking about being in the market over the next two years or so. If you are not currently in, is it a good time to be in? There has been a significant rise. I'm sitting on the sidelines now and if it hasn't dropped before we have a vaccine, I probably won't be too worse off. But what to do with the cash in the meantime.

As an aside, the OP posted about liquidating his shares on March 3. He would have been worse off, given the rise since. So hope he didn't.

kinger101

blue_max_3 said:

April is always a good time for the markets as people look to place their S&S Isa allowances and SIP contributions before the end of the tax year. And demand adds confidence. 

I doubt the 5th of April has much significance globally.  

Sailtheworld

blue_max_3 said:

Prism said:

blue_max_3 said: 

I don't want to be the doomster, to use Boris's word But it's an opinion and equally valid as anyone else's.

The point really is that many of those that stay invested don't actually have an opinion at all - or at least one that affects if they stay invested. I have absolutely no opinion about what the markets might or might not do based upon Covid 19. It would be a pure guess if I did. I don't know where the markets will be in 10 or 20 years either but I am betting on them being higher than today

That would be very likely. But the title was about being out of the market until the virus is over. If there was no virus, it would be virtually guaranteed. So, I guess we're talking about being in the market over the next two years or so. If you are not currently in, is it a good time to be in? There has been a significant rise. I'm sitting on the sidelines now and if it hasn't dropped before we have a vaccine, I probably won't be too worse off. But what to do with the cash in the meantime.

As an aside, the OP posted about liquidating his shares on March 3. He would have been worse off, given the rise since. So hope he didn't.

There's a long (couple of hundred years) of stock markets producing inflation beating returns of 3% - 5% per year - given we've had war, famine and pestilence in abundance during that time it's been pretty well stress tested. I can't really see why an investor today can't expect a similar return to one of yesterday if the same level of risk is taken. However that's not guaranteed at all - with or without the virus and we're going to see plenty more bull and bear markets no matter what.

The answer is not to avoid stock market investing at all costs (IMO of course) but to allocate only capital which you're comfortable with placing at market risk. That will depend on how wealthy you already are and your attitude for example a wealthy person can afford to take more risk but, then again, if someone is wealthy why do they want to take any risk - that's down to attitude.

Ref the OP. AIUI he used that capital from the liquidation to buy gold and increase cash reserves. Gold is up 10% since March 3rd so depending on timings and ratio of gold / cash he might be up. I don't think he's bothered because he's banking on a big crash before Autumn and him being able to price assets better than the market.

Thrugelmir

blue_max_3 said:

Prism said:

blue_max_3 said: 

I don't want to be the doomster, to use Boris's word But it's an opinion and equally valid as anyone else's.

The point really is that many of those that stay invested don't actually have an opinion at all - or at least one that affects if they stay invested. I have absolutely no opinion about what the markets might or might not do based upon Covid 19. It would be a pure guess if I did. I don't know where the markets will be in 10 or 20 years either but I am betting on them being higher than today

That would be very likely. But the title was about being out of the market until the virus is over. If there was no virus, it would be virtually guaranteed. So, I guess we're talking about being in the market over the next two years or so. If you are not currently in, is it a good time to be in? 

Traders speculate on the market indexes. Investors trade individual shares. Timing the market is fraught with difficulty. By missing the best trading days of the every year can itself severely dent returns. Also remember much of the return is derived from income reinvestment over the longer term. Sounds as if a monthly drip feed into a broadly based tracker is the way forward for you. 

blue_max_3

Again, because it's always been like that, doesn't help in the next couple of years. That's a short time and extraordinary circumstances. It isn't the stock market crash of 1929, as we haven't seen the relentless gains that never seemed to end. We have learned something from that.
But if you believe the market will steadily rise over the next two years, you may be right to stay invested. If you expect volatility, there may be more scope to buy in a trough. I'm more prepared to make the latter gamble. I don't have to buy at the very bottom, which is obviously nearly impossible, but nor do I wish to buy close to the top. 
I have a feeling that all this QE stuff buoy's the market. Inflation devalues money and boosts an asset. That may be going to put wind in the sails of the market in a year or two. 
Will be fascinating to see what happens. For the record it's about 5900pts at this time on 11/05/20. Place your bets!

Thrugelmir

blue_max_3 said:

It isn't the stock market crash of 1929, as we haven't seen the relentless gains that never seemed to end. We have learned something from that.

Markets broadly are now more expensive than they were 3 months ago. Also considerably higher than the past 10 year average. That's unquestionable. Suggests that many people are pricing in a speedy global economic recovery at the moment. 

Sailtheworld

blue_max_3 said:

But if you believe the market will steadily rise over the next two years, you may be right to stay invested. If you expect volatility, there may be more scope to buy in a trough. I'm more prepared to make the latter gamble. I don't have to buy at the very bottom, which is obviously nearly impossible, but nor do I wish to buy close to the top.

I'm after long term gains. I have no idea what the markets will do in the next two years and doubt my ability to sell near a peak and buy near a trough so don't allocate too many brain cells to worrying about it.

Life must be one of riches for those who can time trades consistently. I'm not one of those people so invest accordingly. Long term market returns suit me just fine. If they don't materialise in my long term I'll be a bit annoyed but I haven't bet the farm on them so I'll still be OK - just not as rich as I'd hoped.

blue_max_3

I'm not timing anything really. But sitting on the sidelines and seeing what happens. It's high, so I'm not invested yet. If it plunges, I will probably take a punt. If it gradually rises, I won't have lost too much. It seems I have rather more to gain, than lose.

coyrls

blue_max_3 said:

I'm not timing anything really. But sitting on the sidelines and seeing what happens. It's high, so I'm not invested yet. If it plunges, I will probably take a punt. If it gradually rises, I won't have lost too much. It seems I have rather more to gain, than lose.

That pretty much sounds like timing to me.