Another Franklin Fund Nosedive

Della said:
Vanguard's bond fund.
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The reality is that the fund’s current value is the value of those investments at this time. So the question is this: can you find a more profitable risk adjusted use for the money currently in the fund?
 
Sippican said:
Of course the math changes.
I am talking about the next 1,3,5 years, not 15,30,120 years as you described.
In the next 1,3,5 years I can get guaranteed 5.50%.
As with all investments, when markets changes the investment strategy needs to change with it.

When you talk 15,30,120 years.....the math does gets fuzzy.
You are acting like there is only one strategy for 15,30,120 years....there isn't
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anyone looking at a time frame of 1 , 3,5 years shouldn’t be in equities ever …but that is no place for long term money ..even at 65 we have money that won’t be used to eat for two to 3 decades .

smart investors don’t try to time that money in and out of the market .

few are good market timers and end up giving up more then they gain in the short term .

most people will shoot themselves in the foot trying to time there way in .

if that is what you want to do , great ..,but for long term money not needed for decades that s a poor way to invest.

the correct way is find a portfolio you can live with and just leave it alone .

if we didn’t continue to talk about 2008 it in forums , long term investors wouldn’t even remember it happened
 

Brookswood said:
The reality is that the fund’s current value is the value of those investments at this time. So the question is this: can you find a more profitable risk adjusted use for the money currently in the fund?
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I don't really know, Brookswood. We went with Vanguard back in the 80's when my father recommended it and we've seen the value go down and back up so many times we're probably just going to wait it out.

We're gradually taking it out and putting it in our regular savings account in our local bank, anyway. We sort of want to have it all consolidated and simple for my son by the time we die. Stocks and bonds would worry him to death.
 
mathjak107 said:
anyone looking at a time frame of 1 , 3,5 years shouldn’t be in equities ever …but that is no place for long term money ..even at 65 we have money that won’t be used to eat for two to 3 decades .

smart investors don’t try to time that money in and out of the market .

few are good market timers and end up giving up more then they gain in the short term .

most people will shoot themselves in the foot trying to time there way in .

if that is what you want to do , great ..,but for long term money not needed for decades that s a poor way to invest.

the correct way is find a portfolio you can live with and just leave it alone .

if we didn’t continue to talk about 2008 it in forums , long term investors wouldn’t even remember it happened
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This is not about timing. I know people like to throw that word around for just about anything, but timing isn't the word to use in this scenario.

Its about mitigating risk, plain and simple.
When interest rates are up and there is 100% protection of capital, and a good return (4.5-6%) then it makes sense to be in CD, and fixed annuities.
The 'timing' window is totally different that trying to time equities that even on a good day are volatile.
Being in high interest CD/Fixed Annuities, You are always positive in increased cash flow. Especially if you are in CD's that pay interest monthly. You sacrifice a small fraction of a percent on the rate, but you got a steady stream of income.
If interest drop; 1) it won't be overnight, 2) It would indicate the equities will be doing better, 3) You would have a window to get back into equities or 3) go for a long CD (2,4,6,10 year), where rates would probably be higher.
The window for these decisions is longer than 'timing a low or timing a high'.

As I said before, 100's of billions are sitting in cash, reaping the high interest rates. Will it last forever? Of course not. But, to lock in 5.50% for 7 years is not a bad thing.
Compare 401K's and mutual funds these days to interest rates on cash and you will see a big difference in returns.
With the changes that are happening with society, we may never see 'the good old days' of cycles happening.

The influx of illegals on our economy, taxes, deficit, inflation, student loans starting up again. All these play into the health of companies, and in turn, impact stocks......It will be a long time pulling out of our mess we got ourselves in. I'll go with the sure money, rather than the uncertainty of where the country is heading.
We have already lost all the gains made in 2023 in the stock market. I've already made 18K in interest, with not risk to principal.
 
Della said:
I don't really know, Brookswood. We went with Vanguard back in the 80's when my father recommended it and we've seen the value go down and back up so many times we're probably just going to wait it out.

We're gradually taking it out and putting it in our regular savings account in our local bank, anyway. We sort of want to have it all consolidated and simple for my son by the time we die. Stocks and bonds would worry him to death.
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Vanguard is easy to work with on estate issues. They have the knowledge, manpower, and experience to make it very simple and they're available a LOT more hours than a regular financial institution, like a bank. My siblings had their money w/in hours of presenting Vanguard the death certificate after our father passed.
 
we dropped vanguard .

we had enough of their self serving policies as well as the worst customer experience i ever had from a Brokerage .

First vanguard sold us on how anyone can get the results of the pros simply by indexing .

Then they got into promoting their managed accounts and they released a study that said no we can’t .

Investor behavior is doing most of us harm .

Then they got into trust mgmt and deleted all our beneficiaries from joint accounts .

They told us we would be better served with trusts .. WRONG .

I don’t need a trust ,so I pulled our money .

Then the grand pappy of do it yourself indexing was promoting their actively managed funds as superior in advertisements ..

I won’t even go in to again their poor customer service and the way reps handle or rather lack of handling of calls.

While I do use vanguard etfs I will not give vanguard any money to handle directly
 
mathjak107 said:
we dropped vanguard .

we had enough of their self serving policies as well as the worst customer experience i ever had from a Brokerage .

First vanguard sold us on how anyone can get the results of the pros simply by indexing .

Then they got into promoting their managed accounts and they released a study that said no we can’t .

Investor behavior is doing most of us harm .

Then they got into trust mgmt and deleted all our beneficiaries from joint accounts .

They told us we would be better served with trusts .. WRONG .

I don’t need a trust ,so I pulled our money .

Then the grand pappy of do it yourself indexing was promoting their actively managed funds as superior in advertisements ..

I won’t even go in to again their poor customer service and the way reps handle or rather lack of handling of calls.

While I do use vanguard etfs I will not give vanguard any money to handle directly
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I didn't/don't need money management, or trusts so I didn't experience anything like that. Their service has been fine and they never tried to "sell" me anything, each and every transaction I made was self-initiated. Been doing business there since the late 80's.
 
againstthegrain said:
I didn't/don't need money management, or trusts so I didn't experience anything like that. Their service has been fine and they never tried to "sell" me anything, each and every transaction I made was self-initiated. Been doing business there since the late 80's.
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they would not add beneficiaries back on to joint accounts and so we have no use for them . both fidelity and chase couldn’t believe that vanguard did that
 
Sippican said:
This is not about timing. I know people like to throw that word around for just about anything, but timing isn't the word to use in this scenario.

Its about mitigating risk, plain and simple.
When interest rates are up and there is 100% protection of capital, and a good return (4.5-6%) then it makes sense to be in CD, and fixed annuities.
The 'timing' window is totally different that trying to time equities that even on a good day are volatile.
Being in high interest CD/Fixed Annuities, You are always positive in increased cash flow. Especially if you are in CD's that pay interest monthly. You sacrifice a small fraction of a percent on the rate, but you got a steady stream of income.
If interest drop; 1) it won't be overnight, 2) It would indicate the equities will be doing better, 3) You would have a window to get back into equities or 3) go for a long CD (2,4,6,10 year), where rates would probably be higher.
The window for these decisions is longer than 'timing a low or timing a high'.

As I said before, 100's of billions are sitting in cash, reaping the high interest rates. Will it last forever? Of course not. But, to lock in 5.50% for 7 years is not a bad thing.
Compare 401K's and mutual funds these days to interest rates on cash and you will see a big difference in returns.
With the changes that are happening with society, we may never see 'the good old days' of cycles happening.

The influx of illegals on our economy, taxes, deficit, inflation, student loans starting up again. All these play into the health of companies, and in turn, impact stocks......It will be a long time pulling out of our mess we got ourselves in. I'll go with the sure money, rather than the uncertainty of where the country is heading.
We have already lost all the gains made in 2023 in the stock market. I've already made 18K in interest, with not risk to principal.
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the problem is not bailing to cash …the problem is getting back in everything that was pulled out…

missing the early large moves when markets still look like nothing changed or it’s a suckers rally can leave one well behind …

most get blind sided by large quick market moves .

they still think it’s a sucker rally …then when it goes higher still they wait for a roll back .

when the roll back never happens they dip their toes back in a little at a time .

by the time they get it all back in the morningstar small investor returns which track money flow show they are lower then the funds got doing nothing and just staying put .


risk mitigation is by using a low ulcer index portfolios and staying with the plan .

risk mitigation isnt trying to time pulling out and getting in
 
^^^ The single greatest rule of a successful long term retail investment strategy.


My wife is highly trained (SFA and CFP) and worked in the field of risk management for American and international insurance companies and this is exactly how she runs her retirement account.
 
againstthegrain said:
^^^ The single greatest rule of a successful long term retail investment strategy.


My wife is highly trained (SFA and CFP) and worked in the field of risk management for American and international insurance companies and this is exactly how she runs her retirement account.
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exactly …

timing markets in and out has never been a succesful risk mitigation strategy
 
mathjak107 said:
the problem is not bailing to cash …the problem is getting back in everything that was pulled out…

missing the early large moves when markets still look like nothing changed or it’s a suckers rally can leave one well behind …

most get blind sided by large quick market moves .

they still think it’s a sucker rally …then when it goes higher still they wait for a roll back .

when the roll back never happens they dip their toes back in a little at a time .

by the time they get it all back in the morningstar small investor returns which track money flow show they are lower then the funds got doing nothing and just staying put .


risk mitigation is by using a low ulcer index portfolios and staying with the plan .

risk mitigation isnt trying to time pulling out and getting in
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Tell that to the millions of people that are enjoying making money 'hand over fist' in interest, while people cry about their stock losses.
All your hypotheticals just don't add up.
Excuse me while I go see how much I made today.......not in the stock market, but in CD's. All the while my principal is resting comfortably.
 
Sippican said:
Tell that to the millions of people that are enjoying making money 'hand over fist' in interest, while people cry about their stock losses.
All your hypotheticals just don't add up.
Excuse me while I go see how much I made today.......not in the stock market, but in CD's. All the while my principal is resting comfortably.
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ha ha ha .

this is the difference between a long term investor with a strategy and a portfolio that gets rebalanced when assets are in a bear market vs a market timer wanna be who makes investment decisions by the seat of their pants or what they think ….lets look again over a longer period of time and see who fell behind
 
mathjak107 said:
ha ha ha .

this is the difference between a long term investor with a strategy , vs a market timer wanna be who makes investment deci by the seat of their pants or what they think ….lets look again over a longer period of time and see who fell behind
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Well, I have 2 different financial advisors. Goldman Sach and a local financial advisor. Plus I play golf with many Investment Managers for local banks. They all agree the market is not the place to be right now. Actually, with many of their clients jumping to cash and cash alternatives, They are losing on fees.
Something tells me you are one of those.
Funny, you harp on 'timing' again when its the furthest thing in what I'm doing. My timing is in tides not waves. Big difference.
 
a lot of nonsense and soothsayers…

if these guys could predict with any degree of accuracy they wouldn’t be working .

they would be filthy rich simply shorting stocks on their own
 
mathjak107 said:
a lot of nonsense and soothsayers…

if these guys could predict with any degree of accuracy they wouldn’t be working .

they would be filthy rich simply shorting stocks on their own
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no one knows what’s next , not even your supposed geniuses who have to work for a living instead of being wealthy on their fortune telling
 
mathjak107 said:
no one knows what’s next , not even your supposed geniuses who have to work for a living instead of being wealthy on their fortune telling
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Wait.....you actually think I work?...in a job?......funny.......I am retired working as a self employed wealth manager.
How do you think I get to play free golf all the time!
All the finance guys want my money!
I'm up at 4:00am tracking the ASX(some small EV Lithium positions I have there), then 6:00am reading the WSJ front to back.
Not a genius by any stretch, but bringing in good returns even in these down times.
 
Sippican said:
Wait.....you actually think I work?...in a job?......funny.......I am retired working as a self employed wealth manager.
How do you think I get to play free golf all the time!
All the finance guys want my money!
Not a genius by any stretch, but bringing in good returns even in these down times.
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well then congrats to you as a market timer ..let’s compare again down the road once the cycle reverses and you are still on the outside looking in… or are you such a good market timer whatever you pulled out will be all in without missing a beat

i highly doubt that will be the case but good for you
 
^^^Too funny.

2 examples. 1 completely random event and one that built up for a number of years before collapse.

9/11.......
Did you buy, sell, or hold?

The Great Recession........
Did you buy, sell, or hold?

Those that held, or bought came up smelling like a rose. The sellers (mostly) didn't rebuy until the gains were already made so they "sold low, and rebought high."
 
Its a depressing time to be looking at our total balances but it is a good time to buy while prices are down. All the investments I made during the period Sept 30 - Oct 12 last year did great (grew 25+%). I had some standing ('good til cancelled') limit orders at what I considered attractive prices and two of the four I had achieved the lows and bought this past week or so.

But, I have moved some money from investments to rolling one month treasuries because it feels so good to be getting such high (compared to the past several years) bond interest.

Even though people are gloomy about the stock market, when I read the details of the articles, they are still expecting the market to continue to go up, just not as largely as in the recent past.

And when I compare bond rates to historical rates, it looks like they are a lot more normal now, like we were in a weird period recently with high market and low bond, and now we're becoming sort of average which I think is what the commonly recommended asset allocations were based on.
 
as long term investors we wouldn’t even remember the markets were down over those bear markets if we didn’t rehash it .

but plenty of timers got burned or missed their goals by missing the gains because the soothsayers said it was a bad time to be in
 
againstthegrain said:
^^^Too funny.

2 examples. 1 completely random event and one that built up for a number of years before collapse.

9/11.......
Did you buy, sell, or hold?

The Great Recession........
Did you buy, sell, or hold?

Those that held, or bought came up smelling like a rose. The sellers (mostly) didn't rebuy until the gains were already made so they "sold low, and rebought high."
Click to expand...
Didn't do anything after 9/11, didn't even think about it....was busy recovering banks from 9/11

Recession? Didn't do anything. 401K's were not robust enough to choose self direct.

Those were different time than the situation we are in now. Each event, brings different challenges and opportunities.
 

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