Is there a 'right time' to cut your losses?

george4064

If you have lost faith in Vanguard LifeStrategy 100% and have cut your losses, that effectively means you've lost faith in mankind and the world that we live in!

MaxiRobriguez

annabanana82 said:

Thrugelmir said:

annabanana82 said:

I've surprised myself with my risk tolerance (granted I've only been in a week or two) but I'm quite happy with my choice of 100% equities for a number of reasons:

Until an event happens people rarely know themselves. When your portfolio is worth £500k and it drops 27%.  Some £135k. Then you'll start to question whether you are holding the right "markets". Equities come in many shapes, forms and sizes. 

Granted, the other reasons in my post point to why I'm happy with this approach at this  time.

Should I ever get to the point where I'm talking much bigger numbers and my other points are less valid then I'm sure my attitude to risk would drop

It's only natural to become more defensive to hold onto what you have when your pot gets bigger. It also correlates with life as well, as you move away from accumulation phase and need to consider proximity risk. 

I too am all equities at the moment but won't be in 15 years time.

whatstheplan

Eyeful said:

This is why with VLS you 
1. Have any emergency fund.
2. Invest at a share bond split you are comfortable with
3. Invest for at least 10 years or longer

If you are already worrying about "the right time to be cutting your losses", either you
(a) should not be investing
(b) have invested at a share/bond split which is beyond your risk tolerance
.

I've noticed this over my 3 decades of posting on forums ... people jumping to conclusions based on things you post or topics you start.

I'm only asking a question that interests me, I'm not already worrying about any of my investment decisions to date

strawb_shortcake

MaxiRobriguez said:

annabanana82 said:

Thrugelmir said:

annabanana82 said:

I've surprised myself with my risk tolerance (granted I've only been in a week or two) but I'm quite happy with my choice of 100% equities for a number of reasons:

Until an event happens people rarely know themselves. When your portfolio is worth £500k and it drops 27%.  Some £135k. Then you'll start to question whether you are holding the right "markets". Equities come in many shapes, forms and sizes. 

Granted, the other reasons in my post point to why I'm happy with this approach at this  time.

Should I ever get to the point where I'm talking much bigger numbers and my other points are less valid then I'm sure my attitude to risk would drop

It's only natural to become more defensive to hold onto what you have when your pot gets bigger. It also correlates with life as well, as you move away from accumulation phase and need to consider proximity risk. 

I too am all equities at the moment but won't be in 15 years time.

I agree, as I said I'm only a few weeks in and I suspect making the decision when and how to start de-risking may be a harder call.

On the other hand if £500k was still only 3% of my wealth then I'd probably not be losing any sleep about a 27% drop. 
Investing choice and risk tolerance is all relative to one's personal circumstances 

whatstheplan

annabanana82 said:

I've surprised myself with my risk tolerance (granted I've only been in a week or two) but I'm quite happy with my choice of 100% equities for a number of reasons:

I'm invested in a LISA so get an 25% from the government.

For various reasons I've only invested around 3% of my total cash reserves. 

Im not investing what I can't afford to lose.

I'm locked in for at least 22 years, so I have time on my side. I don't have a date I need the money.

I don't actually need a lump sum at the end, it'll be nice to have but this is purely nice to have money. I have a good enough pension to live quite comfortably when the time comes.

I do not understand the selling at a loss, until you sell it's only a theoretical loss - as someone else stated this would differ in a single stock rather than a fund. I also think understanding why the market is reacting like it is helps add perspective.

In 20-25 years time,  if it's all gone tits up I'd rather look back and say I tried rather than wonder what if?

What I invest, is money I'd otherwise squander so by not investing I may have some more shoes and few different days/meals out. 

If my fund goes up I get a nice warm feeling, if it goes down then I can choose to invest more and wait it out for the reward so win win 

I may of course be completely naive and wrong...

The bits of your post I've highlighted in bold reflect my position.  Given my objectives, bonds aren't going to do much for me in the grand scheme of things, plus my timescales are more compressed than yours, so I've gone 100% equity.

Eco_Miser

whatstheplan said:

I've noticed this over my 3 decades of posting on forums ... people jumping to conclusions based on things you post or topics you start.

That's a lot better than jumping to conclusions based on things you didn't post.

But were conclusions actually jumped to, or just advice  conditionally given? With the condition based on the question asked.

steampowered

Nobody can accurately predict what is going to happen next in the markets. If you could, you would be a billionaire.

For that reason there can never be a "recognized right time" to buy or sell an investment.