Liquidate entire portfolio until virus is over?

BananaRepublic

EdGasketTheSecond said:

Thrugelmir said:

Sounds as you have a highly correlated portfolio if you are considering liquidating everything. Markets may well fall by a third. Doesn't mean that all shares will. Active management rather passive is better in turbulent markets. Horses for courses as they say. 

Yes well my idea of 'active management' is to get out of equities now and stay out until the virus has done its dirty work and the carnage can be assessed; assuming I am still alive at the end. Just wondering if anyone else felt the same or had ever done that.

I’m sure this has been said, but I’m not searching through 74 pages. Moving out of the market is exactly what you should not do as it will crystallise your losses. Timing the market is not a good idea, simply because it can’t be done reliably and consistently. Stay in the market until it recovers, which could take quite a few years. Unfortunately the future progress of the markets will depend strongly on events, such as government interventions, or lack thereof. This could be a quick recovery, or a long slow one. My guess is the latter. Service industries are nose diving and companies are going bust. As it is many industries were existing on a hand to mouth basis. But I suppose the bright side is that some such as restaurants will be replaced by newcomers fairly quickly. Oh and Amazon et al are thriving. 

It was obvious a few months back that a crash was due and ai was expecting one, but I admit I was taken aback at the scale of the crash and the cause which I did not expect. 

BananaRepublic

marlot said:

EdGasketTheSecond said:

Is anyone else contemplating or have ever liquidated all their shareholdings and stayed in cash (or some other non-equity investment) while markets have crashed? I am thinking that this is probably only the beginning of a protracted bear market and we could see values drop by a third from here.

The Spanish Flu hit the UK in three waves.  It's highly likely that Covid-19 will also hit the UK in waves.  How will you know when you hit the bottom?

Indeed. The current containment is unsustainable as it will destroy the economy, and the virus will rip through the population at some stage anyway. You have to remove lockdown some time, I guess it’s a case of slowing the onslaught, so the NHS can cope. And yes there will be a second wave. The markets have crashed due to uncertainty. At some stage boys in red braces will stop cacking themselves, and markets will climb, 

kinger101

EdGasketTheSecond said:

I have not called anyone a fool as far as I know and apologise if I have given that impression. The thread has had 733 replies to date so I don't think you are correct to say it is not interesting as many people do find it interesting. Some people also agree with me so 'we all think you're a fruit loop' apart from being insulting is evidently also incorrect.

My comment was tongue-in-cheek, but I feel appropriate to the comment I was replying to on the nature of this discussion.  You're not prepared to change you mind based on the responses, and neither are the people with whom you disagree.  Polemical debates serve no purpose.  Why did you open up the question to the forum if you already had your answer, or were simply going to google half-baked rebuttals to any opinion which differed from your own?

EdGasketTheSecond

Why have any debate or any discussion then? It was a genuine question/thread and I am genuinely interested in replies. When I started the thread I had not decided to liquidate anything and along the way have commented that the delay cost me dearly. Also along the way it has become apparent to me that the likelyhood is for markets to go lower and major economic storms ahead. In that scenario I am attracted to gold. I have formed opioion as events have unfolded. I also like my opinion 'tested' by those who hold a different view however some posters can't seem to bear anyone who doesn't agree with them which is a shame but to be expected I suppose.

BananaRepublic

EdGasketTheSecond said:

Why have any debate or any discussion then? It was a genuine question/thread and I am genuinely interested in replies. When I started the thread I had not decided to liquidate anything and along the way have commented that the delay cost me dearly. Also along the way it has become apparent to me that the likelyhood is for markets to go lower and major economic storms ahead. In that scenario I am attracted to gold. I have formed opioion as events have unfolded. I also like my opinion 'tested' by those who hold a different view however some posters can't seem to bear anyone who doesn't agree with them which is a shame but to be expected I suppose.

The problem is that you will be shutting the gate after the horse has bolted. The markets have already factored in fear and panic, and gold prices will have adjusted. Sure, change tack now, but experienced investors will have taken decisions beforehand, the naive panic now and sell up. Yes the markets could fall further, but they might not. We don’t know. I reckon now is a good time to buy, but I am no longer in that position and need to ride it out using cash assets until all is well again.

EdGasketTheSecond

Ah that's where I disagree as I don't think the markets have correctly priced the situation by a long stretch. We are in a worse scenario than 1929 and markets have a long way to drop from here. The only unkown for me is whether unlimited QE might be able to keep the stockmarket up for a while until we get a complete collapse due to said unlimited QE.

Anyway I already got out of a lot of equities and moved to gold/silver so I am part way there but not at my desired 70% gold/silver yet. There is a possibility of a pullback in gold as per 2008 but back then QE was stretched out over a longer period. This time the FED seems to be 'kitchen sinking' everything at the start.

BananaRepublic

EdGasketTheSecond said:

Ah that's where I disagree as I don't think the markets have correctly priced the situation by a long stretch. We are in a worse scenario than 1929 and markets have a long way to drop from here. The only unkown for me is whether unlimited QE might be able to keep the stockmarket up for a while until we get a complete collapse due to said unlimited QE.

Anyway I already got out of a lot of equities and moved to gold/silver so I am part way there but not at my desired 70% gold/silver yet. There is a possibility of a pullback in gold as per 2008 but back then QE was stretched out over a longer period. This time the FED seems to be 'kitchen sinking' everything at the start.

So you know what events will happen and where the markets are going. Hi ho. You are in essence prepared to gamble based on no more than a hunch. Fair enough, it’s your money. But you are better off assuming you don’t know and go from there. 
I am happy to admit that this one took me by surprise, and perhaps my investments were not ideal, but I kept 3-4 years of cash available based on the “I don’t know” approach. 

EdGasketTheSecond

I don't 'know', no-one can say that. I have researched and come to my own conclusions and made my decision. It is no more a 'gamble' than staying in the market or in cash either of which could also end badly; the markets might crash and high inflation could wipe out cash.

Can you explain what 'assume I don't know and go from there means'? Where should I go or what can I do differently other than research as much as possible and come to a decision?

port_of_spain

Have opinions on what will happen? OK.

Bet money on your opinions? OK, providing you can afford the money you'll lose if you're wrong, and (if you have joint finances) providing you aren't dragging your spouse/partner into a bet they don't want to take.

Bet money you can't afford to lose? Not OK.

It's simple, really

EdGasketTheSecond

The simple thing is that gold will always be worth something. You can't say that about equities or cash with any certainty right now.