Are prices due to crash?

[Corradobrit]

My wife has a Stocks and Shares ISA with Fidelity which was 100% in an S&P 500 tracker.
About end of September I‘m getting uneasy about the way the S&P kept going up. The way I looked at it the valuation was based on everyone driving a Tesla, changing their iPhone every two year and everything we bought would have an Nvidia chip in it etc.etc.
In short it was overvalued.
So we sold and bought a one year bond with Mansfield Building Society paying 6% interest.
The S&P has put on another 10% since then. So a disastrous decision.
Well maybe. Give it time. I still think the S&P is way overvalued.
So there you go, that’s my hot tip for 2024, sell the S&P and buy the FTSE. But be warned. I’m a useless tipster.

My 401k retirement fund is locked in with TIAA Cref. I have always been a conservative investor and when I hit 55 reduced my stocks weighting to 50% with a move away from tech heavy stocks to S&P. The rate of increase in the fund has been nothing but phenomenal in the last 6 months, steaming past the pre covid highs, but it does make me uneasy. Luckily the US economy is going gangbusters and is in a lot stronger position than the UK or Eurozone. I'm not too worried. But being 5 years away from taking formal retirement I will likely drop to 30% and preserve those gains.

 

[BrendanJ]

I'm not too worried. But being 5 years away from taking formal retirement I will likely drop to 30% and preserve those gains.

I have always thought this approach too conservative
Of course markets could drop, that’s a given with markets and why they say only invest for long term, more than 5 years. I read into that that not needing the capital for at least 5 years because it gives chance of recovery and over longer term stock market always out paces any other type of investment
So in your case you have 5 years to retirement and unless you plan to lock it all into an annuity or semi cash may live until say 80
That’s a long time for investments to be allowed to run whilst only taking a small percentage of it each year
Let me clearly state I am not a financial advisor or expert, just an interested investor with a stake in the game
No risk no gain, and most People get confused on the concept of risks and thus play safe, perhaps too much so
See you down the food bank

 

[Corradobrit]

I have always thought this approach too conservative
Of course markets could drop, that’s a given with markets and why they say only invest for long term, more than 5 years. I read into that that not needing the capital for at least 5 years because it gives chance of recovery and over longer term stock market always out paces any other type of investment
So in your case you have 5 years to retirement and unless you plan to lock it all into an annuity or semi cash may live until say 80
That’s a long time for investments to be allowed to run whilst only taking a small percentage of it each year
Let me clearly state I am not a financial advisor or expert, just an interested investor with a stake in the game
No risk no gain, and most People get confused on the concept of risks and thus play safe, perhaps too much so
See you down the food bank

Yes, I will be converting it to an annuity when I hit 65. During Covid the fund dropped 30%. I want to preserve the record gains I have now, which is more than enough to keep me in the luxury to which I've become accustomed . I think it's too tempting to be aggressive and after the recent dip I know how quickly the floor can fall out from under the nest egg.

 

[Mansfieldman750]

My 401k retirement fund is locked in with TIAA Cref. I have always been a conservative investor and when I hit 55 reduced my stocks weighting to 50% with a move away from tech heavy stocks to S&P. The rate of increase in the fund has been nothing but phenomenal in the last 6 months, steaming past the pre covid highs, but it does make me uneasy. Luckily the US economy is going gangbusters and is in a lot stronger position than the UK or Eurozone. I'm not too worried. But being 5 years away from taking formal retirement I will likely drop to 30% and preserve those gains.

Hmm, let’s hope nobody going to the food bank.
I never worry when markets are going down but I fret when they keep going up. Be fearful when others are greedy and all that.
The S&P is on a p/e of 24 and a dividend yield of 1.5%, FTSE is on a p/e of 12 and a dividend yield of 4%. So FTSE is twice as cheap, maybe for good reason. Time will tell.
Anyway I’m going to sit on the sidelines as far as the S&P is concerned. Maybe it will keep going up and I’ll never get back in and regret it for evermore. But hey, you have to make a call and I‘ve made mine.

 

[BrendanJ]

That’s perfectly reasonable based on your circumstances and risk tolerance and availability of other funds / income.
I was just saying that whilst it is safer than in the market it will likely give less performance. If that meets your goals then you are satisfied and a lucky man
Best wishes for the future

 

[Corradobrit]

Hmm, let’s hope nobody going to the food bank.
I never worry when markets are going down but I fret when they keep going up. Be fearful when others are greedy and all that.
The S&P is on a p/e of 24 and a dividend yield of 1.5%, FTSE is on a p/e of 12 and a dividend yield of 4%. So FTSE is twice as cheap, maybe for good reason. Time will tell.
Anyway I’m going to sit on the sidelines as far as the S&P is concerned. Maybe it will keep going up and I’ll never get back in and regret it for evermore. But hey, you have to make a call and I‘ve made mine.

Stock market Investments are just State endorsed gambling. Preempting the market is better left to the professionals and by the time Joe Public knows anything the big players are long gone. This is why I prefer to be less aggressive and keep my full head of hair with very little grey.

 

[pjm-84]

I moved more across to income funds as the UK market has been pretty flat. Having a fund for 5yrs with no accumulation and monthly cost was starting to grind so I had a purge back in October. At least an income can offset the yo-yoing prices

 

[Amarillo]

My 401k retirement fund is locked in with TIAA Cref. I have always been a conservative investor and when I hit 55 reduced my stocks weighting to 50% with a move away from tech heavy stocks to S&P. The rate of increase in the fund has been nothing but phenomenal in the last 6 months, steaming past the pre covid highs, but it does make me uneasy. Luckily the US economy is going gangbusters and is in a lot stronger position than the UK or Eurozone. I'm not too worried. But being 5 years away from taking formal retirement I will likely drop to 30% and preserve those gains.

I take yet another different approach.
16% US stocks
16% Europe stocks (exc UK)
16% Japan stocks
16% Pacific stocks (exc Japan)
16% emerging markets
20% UK stocks (because I’m a patriot)

About three have risen by ~20% this year (including the US) and about three have risen by ~5% (including the UK). But that’s fine. The stellar compensate for the laggards, and I’ll just leave it all as it is.

All the funds are income which give ~3.5%. I had been taking the cash, but now just leave it within the ISA envelope. I only get 3.35% interest, but that’s fine. It is good to have a little stash of free cash for guilt free spending.

We hope to expand our ISA wrapper by the full £40,000 per year for the next five years at least, and by that time with retirement looming it should be giving us at least £10,000 per year in dividends: an annual guilt free tax free cash bonanza.

 

[Mansfieldman750]

I take yet another different approach.
16% US stocks
16% Europe stocks (exc UK)
16% Japan stocks
16% Pacific stocks (exc Japan)
16% emerging markets
20% UK stocks (because I’m a patriot)

About three have risen by ~20% this year (including the US) and about three have risen by ~5% (including the UK). But that’s fine. The stellar compensate for the laggards, and I’ll just leave it all as it is.

All the funds are income which give ~3.5%. I had been taking the cash, but now just leave it within the ISA envelope. I only get 3.35% interest, but that’s fine. It is good to have a little stash of free cash for guilt free spending.

We hope to expand our ISA wrapper by the full £40,000 per year for the next five years at least, and by that time with retirement looming it should be giving us at least £10,000 per year in dividends: an annual guilt free tax free cash bonanza.

Good man. I never liked your idea of taking the dividends out of the ISA. 3.35% on cash ain’t bad.

 

[Amarillo]

Good man. I never liked your idea of taking the dividends out of the ISA. 3.35% on cash ain’t bad.

It is highly illogical. It would be better to take the cash and put it into my 4% Lloyds account - even if I have to pay tax on any additional interest. But best sense would to reinvest and sell if I want some cash. But somehow that wouldn’t feel so guilt free.

 

[OGII]

We'll be seeing @Amarillo's Spring WBAC valuation before this thread gets back on topic.... My past 205GTi beats the 309 diesel reminiscing hands down. Wasn't bought on PCP and would have been a great investment if someone had given me that tip and I could've afforded to mothball it.

 

[larrylamb]

My only investment in shares is BAE Systems, hitting a high today with a 11.27% , 30 day rise and just under 36% for the past year.
They did drop 20% in one day though in 2002, eek!

 

[Mansfieldman750]

My only investment in shares is BAE Systems, hitting a high today with a 11.27% , 30 day rise and just under 36% for the past year.
They did drop 20% in one day though in 2002, eek!

I think that makes you the champ, unless someone has some Rolls-Royce which is up er 186.87% over the past year.

 

[Corradobrit]

We'll be seeing @Amarillo's Spring WBAC valuation before this thread gets back on topic.... My past 205GTi beats the 309 diesel reminiscing hands down. Wasn't bought on PCP and would have been a great investment if someone had given me that tip and I could've afforded to mothball it.

I was just thinking about the 205GTi. 1.6 or 1.9 version? I really wanted one of the 1.9's in the early 90's but it was too expensive back then for a newly graduated PhD student.

 

[Amarillo]

I think that makes you the champ, unless someone has some Rolls-Royce which is up er 186.87% over the past year.

War is very kind to some industry.

 

[Mansfieldman750]

War is very kind to some industry.

Yeah, there was that bloke your father knew who accidentally made his fortune insuring boats plying the Mekong during the Vietnam war.

 

[This_one_goes_to_eleven]

I think that makes you the champ, unless someone has some Rolls-Royce which is up er 186.87% over the past year.

I’ve had some RR for a few years and they are +221% up. Somewhat offset by the -77% of a hydrogen fuel company I bought ‍

 

[sidepod]

The clients of my business are mostly listed U.K. Homebuilders.

Given they represent the backbone of the U.K. economy, I would say that unless there is a wholesale and quick change in planning legislation, it looks incredibly bleak.

Starmer’s bunch of morons will soon have every square mile of green space built on.

 

[Mansfieldman750]

I’ve had some RR for a few years and they are +221% up. Somewhat offset by the -77% of a hydrogen fuel company I bought ‍

New champ, you jammy sod.

 

[larrylamb]

I was just thinking about the 205GTi. 1.6 or 1.9 version? I really wanted one of the 1.9's in the early 90's but it was too expensive back then for a newly graduated PhD student.

Had both in my youth, each had it's own merits.

 

[JuanVecino2023]

Hmm, let’s hope nobody going to the food bank.
I never worry when markets are going down but I fret when they keep going up. Be fearful when others are greedy and all that.
The S&P is on a p/e of 24 and a dividend yield of 1.5%, FTSE is on a p/e of 12 and a dividend yield of 4%. So FTSE is twice as cheap, maybe for good reason. Time will tell.
Anyway I’m going to sit on the sidelines as far as the S&P is concerned. Maybe it will keep going up and I’ll never get back in and regret it for evermore. But hey, you have to make a call and I‘ve made mine.

I think the P/E of NYSE vs FTSE pertains more to the constituent stocks?

Far more tech in US, all banks and builders here. Traditional income stocks trade on lower multiples, as they’ve don’t tend to grow rapidly.

 

[This_one_goes_to_eleven]

New champ, you jammy sod.

My brother does work them and 3 yrs ago said they were a decent look. He didn’t buy any himself . ( you still in mansfield? I’m in Kirkby so not that jammy )

 

[Mansfieldman750]

I may as well have my tuppence worth on the original topic while I’m here.
If you go back far enough in this thread I predicted that Cali prices would fall because 1.3 million homeowners had to remortgage in 2023 and some of were bound to be Cali owners who would have to sell. Never happened, prices held up.
Now 1.4 million homeowners have to remortgage in 2024 so ….. prices will still hold up.

 

[Mansfieldman750]

My brother does work them and 3 yrs ago said they were a decent look. He didn’t buy any himself . ( you still in mansfield? I’m in Kirkby so not that jammy )

Yes Mansfield since 1993. Don’t send me back to Scotland.

 

[Mansfieldman750]

I think the P/E of NYSE vs FTSE pertains more to the constituent stocks?

Far more tech in US, all banks and builders here. Traditional income stocks trade on lower multiples, as they’ve don’t tend to grow rapidly.

Oh yes, they deserve to be more highly rated than the boring old FTSE companies but I just have a feeling the Magnificent Seven ( Amazon, Alphabet, Nvidia, Tesla, Microsoft, Apple, Meta ) have just gotten ahead of themselves. Tesla especially I wouldn’t want to own.