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  1. #1
    370H-SSV-0773H linux_author's Avatar
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    Diversification work for you?

    i feel a bit more comfortable posting here... but i wanted to get a feel for how folks have weathered the year-long market corrections... just went through the figures, and it looks like diversification works! have only taken a 2 percent hit in my diversified holdings/accounts vs the wife unit's stock-based accounts (which suffered a 10 percent decline)...

    my retirement horizon is still out nearly 20 years, but the mix we have for our age is (50/30/10/10: stocks/bonds, real estate, insurance, cash); within that mix my holdings were 9/35/56 short-term, bonds, stocks, while the wife unit's were 84/16 stocks, short-term...

    in fact, with the last two months i've made a determined effort to increase savings (cash, indexed funds in tax-free account, i.e. ROTH IRA)... my personal feeling is that this correction offers an opportunity for some folks to make up a tad for the past 10 years... (market was at a 5,000 Dow when i first got started - really, really, really wished i had started earlier)...

    hope everyone else is doing OK - i guess my advice would be: "Don't panic."

    :-)

  2. #2
    Senior Member
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    While waiting for my late mother's will to wend it's way through the Florida courts and for the estate to end up in Canada, the portfolio has lost a bit over 15%.
    Don't get me started on your deregulated economy and banking system.

    But, you are right. The key is: don't panic.

  3. #3
    Small Member maddmaxx's Avatar
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    Diversified myself out of the stock market 14 months ago..... But then, I'm 62 and can't wait around and wait for my money to come back. At this point, I'd consider burried coffee cans a safe investment.

    I'm more worried about the status of my first pension if the issuing insurance company goes bankrupt. I still have more bikes to build.

  4. #4
    Pedaled too far. Artkansas's Avatar
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    Well, since I've barely gotten out from under a massive amount of credit-card debt, and for the past third of a year getting paid at all has been touch and go, and now I'm unemployed with my former employer owing me over $9,000. Whether to diversify my investments or not hasn't really gotten high on my radar. I'm just glad that I took the advice of having 3-6 months income saved up for a rainy day. And I now have a little more time to go on bike rides.
    "He who serves all, best serves himself" Jack London

    Quote Originally Posted by Bjforrestal View Post
    I don't care if you are on a unicycle, as long as you're not using a motor to get places you get props from me. We're here to support each other. Share ideas, and motivate one another to actually keep doing it.

  5. #5
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    Does this mean I should own several different brands of bikes?

  6. #6
    370H-SSV-0773H linux_author's Avatar
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    Quote Originally Posted by Artkansas View Post
    I took the advice of having 3-6 months income saved up for a rainy day. And I now have a little more time to go on bike rides.
    +1

    sage advice... six months' minimum IMHO... hope things get better...

    and diversifying brands is always good... i'm spread between Specialized and Pedal Force (a good group buy here on BF for a studly CF frameset - it's now my favorite ride)...

    my thoughts are with all those 50+rs struggling right now...

  7. #7
    Squirrel solveg's Avatar
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    Down 2% in what timeline?

    I'm extremely diversified, but I was part of a building sale last summer and against my better judgement put in a bunch of money when the market was at an all time high. I knew better, but doubted myself. I've lost about 10% since the beginning of last summer. Much less than the market in general, so I'd say it worked.

    Now, my 401k, in which I let myself trade and test myself, I was about 40% above the market in the past 3 years. And I never had more than 5 stocks going. I was thinking myself very clever, because against the S&P it usually gained more or lost less each day. But then the last 2 weeks happened, and now my gain is substantially diminished. I'd say I'm only 10% over the S&P now.

    I'm involved in another building sale in February, and I'm going to keep that money away from the market. Maybe start dribbling it in 1.5 years from now. We haven't seen the massive layoffs yet, and that needs to happen before I trust the market again. Although, I don't see any reason why it should rebound. America doesn't have a lot to offer right now, besides food.

    I'm terrified this will screw up my retirement.

  8. #8
    370H-SSV-0773H linux_author's Avatar
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    Quote Originally Posted by solveg View Post
    Down 2% in what timeline?

    [snip]

    I'm terrified this will screw up my retirement.
    - last 12 months...

    - i wouldn't worry about retirement unless you're due in the next year or so...

    - i grew up in an orphanage, so my lifestyle expectations can adjust somewhat...

    :-)

    (whenever my wife complains about having to max her 401(k) i tell her it's the difference between a view of the ocean or a view of an alley in retirement)...

  9. #9
    Ride Daddy Ride Jet Travis's Avatar
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    I'm fairly diversified. I'm figuring either Tom Bombadil, Louis, or Digital Gee will look after me in my old age.
    "Light it up, Popo." --Levi Leipheimer

  10. #10
    gone ride'n cyclinfool's Avatar
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    I'm practicing for my retirement job

    "Hello - welcome to Walmart"
    "Of all the things I ever lost I miss my mind the most." Mark Twain
    If all you have is a hammer, every problem looks like a nail.

  11. #11
    Banned. The Weak Link's Avatar
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    Never look at your pension plan details in a down-turn.

  12. #12
    The guy in the 50+ jersey PAlt's Avatar
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    Though I am certain these are difficult times for any one with investments (including myself), it's much more so if one lives it every day as I do. My job involves navigating a specialized part of these troubled markets, , a situation that's been going on for over a year. Thankfully my cycling gives me the stress relief I need, or you might be reading / hearing about me on the news...

  13. #13
    feros ferio John E's Avatar
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    The key is to own investment-grade securities and not to panic. In fact, a serious market correction is a great opportunity to accumulate a favorite stock, assuming that you have several months of liquid capital, so that you do not have to sell anything in a down market.

    I am currently working on a career transition from industry into academia, hoping for greater stability and a bit less stress, and willing and able to take a significant pay cut.
    "Early to bed, early to rise. Work like hell, and advertise." -- George Stahlman
    Capo [dschaw'-poe]: 1959 Modell Campagnolo, S/N 40324; 1960 Sieger, S/N 42624
    Peugeot: 1970 UO-8, S/N 0010468
    Bianchi: 1981 Campione d'Italia, S/N 1.M9914
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  14. #14
    His Brain is Gone! Tom Bombadil's Avatar
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    Quote Originally Posted by Jet Travis View Post
    I'm fairly diversified. I'm figuring either Tom Bombadil, Louis, or Digital Gee will look after me in my old age.
    Just let me know where you'll be living and I'll come and visit every 6 months.
    "Too often I would hear men boast of the miles covered that day, rarely of what they had seen." Louis L'Amour

    There are two types of road bikers: bikers who are faster than me, and me. Bruce Cameron - Denver Post

  15. #15
    Ride Daddy Ride Jet Travis's Avatar
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    Quote Originally Posted by Tom Bombadil View Post
    Just let me know where you'll be living and I'll come and visit every 6 months.
    You won't have far to go. I'll be living at your house.
    "Light it up, Popo." --Levi Leipheimer

  16. #16
    Squirrel solveg's Avatar
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    See, I know diversification gives you lower risk/lower return. But there's a case for individual stocks, too. Right now, the S&P is down 2.34%, but my 401k is only down .34%.

  17. #17
    just keep riding BluesDawg's Avatar
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    I'm definitely in favor of diversification. Road bikes, mountain bikes with full suspension, mountain bikes with no suspension, all around doodling bikes, fixed gear bikes...

    Having a diverse portfolio of bikes greatly increases the fun return on your bike stable investment.
    The more you ride your bike, the less your ass will hurt.

  18. #18
    tsl
    tsl is offline
    Plays in traffic tsl's Avatar
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    Diversified? That means spreading it around between multiple crooks, right?
    My two favorite things in life are libraries and bicycles. They both move people forward without wasting anything.
    The perfect day: Riding a bike to the library.—Peter Golkin


    Lucky for me, I work at a library and bike to work.

  19. #19
    Senior Member RoMad's Avatar
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    I have a pretty good bit of money (to me anyway) invested in Florida real estate. We had to lower the rent on one house by 20% to get someone back in it after our renters moved back up north. There are a lot of empty houses where people got greedy and bought like crazy thinking they could always resell for a profit. I think with patience it will get back to normal and a lot of the rookie real estate investors will learn a very expensive lesson. I feel badly for the people in the building industry who are out of work now. As for my retirement investments, I am not even going to look at them for awhile.

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