02-22-2020, 11:40 AM
(02-19-2020, 07:39 AM)fenders53 Wrote: Failure to get the timing perfect is not necessarily failure. Nobody will ever call tops and bottoms perfectly over time. This thread is not intended to be downbeat. As I mentioned I find analysis of my mistakes to be positive going forward. I made mistakes my first five years I'd be embarrassed to share. Not repeating those mistakes made me a lot of money the next 20 years. It may sound strange, but a 10 year bull is a bad thing in a way. A new generation thinking they can't lose and getting reckless. Some have had time to build their port to $100K+ without a true understanding they really can lose over half of it in short order. Every generation has to learn it the hard way.
For me it's about time in the market, with that comes experience as long as one learns from their mistakes.
My biggest mistake was flip flopping, not having a solid plan and not understanding my risk tolerance when a downturn would happen. During the dot-com bust my risk tolerance was really low, even though I was invested in mutual funds I panicked and lost 50-60% of my portfolio, permanently, because when the market kept going down I kept selling. Luckily, altogether I lost maybe 8 or 9k dollars total--before the bust I cashed out my only individual stocks Exxon and Paychex to purchase my first home. If I could go back in time I never would have sold Exxon or Paychex. If I would have just sat on my ass everything would have come back and then some.
All together it took me about 12 years to get to 213k; however, that 213k quickly turned into 104k during the Great Recession. So, in essence it took me about 12 years to save 104k dollars...lol...The only difference was I didn't panic no matter how many people told me to cash out. No, I kept buying on a weekly basis and didn't look back--it wasn't easy but I felt it was the only option.
So, back then it took me more then a decade to accumulate just over 100k
Today, my net worth can go up or down 100k plus in two or three months
I've never been a risky investor, but I was the perfect example that you can invest in quality stocks or mutual funds and lose your ass if you don't know what you're doing or not prepared to deal with yourself as an investor in a downturn. Those recessions come and we will get more, multiple recessions/corrections over the course of our lifetimes. The question is how are you going to react? Quality investments are not going to save you if you panic at the wrong time.
Likewise, FOMO (fear of missing out) is also not going to save you in this bull market--it's not going to save you in any bull market. However, if you don't stop and continue to add in quality stocks or mutual funds the average is in your favor--over the long term--even if your portfolio gets hit hard.
I'm not going to lie, I tell people this all the time..if you manage your own investments you better have a steel cast iron stomach when that downturn occurs.
It's not easy.