Looking at the state of the FTSE 100 and the various markets around the world, it looks like the Bear is well and truly out of the woods and is doing his business in the markets!
I’m definitely not panicking and definitely won’t be “selling everything” as advised by some. Neither however, will I be ‘greedy when others are fearful‘ – I’m just going to carry on plodding along with my monthly investing plan, the same as Mr Z.
More in bonds and cash? Actually no – I’m trying to build up my dividend income so I’ll be buying more shares/investment trusts. On the funds front, Emerging Markets in my portfolio look rather lean so I’ll be chucking more in that direction as I continue to aim for my Portfolio for All Seasons.
Since I don’t have a wad of spare cash to go on a bargain equity shopping spree, I’m unlikely to reap huge rewards from a bear market, as suggested by FI Fighter‘s post on how “Bear Markets Create Millionaires’, but I should be able to pick up some shares/investment trusts at a lower price/discount, which in the long run should make some positive difference.
Buying on the dips? No, just buying anyway!
Benchmarking
Unlike some investors, I don’t measure my portfolio against any particular benchmark or index. Â I’m sure it would be very interesting to know about my investments in that sort of detail but personally, I don’t feel like I need to know.
I do however use Monevator’s Unitisation Method to track my entire portfolio (my Future Fund) and last year, saw an overall positive return of 3%.
How that compares with anything else or anyone else for that matter, doesn’t really concern me, except that I’m happy with that return, considering the volatility we experienced in the latter part of the year.
It’ll be interesting to see what return I’ll get in 2016 but of course, there’s an entire year of ups and downs ahead of us!
I’m buckled up nicely on this roller-coaster! 🙂
Not Alton Towers…
Good post Weenie.
I share the same thought process. I will be buying into the markets each month when I get paid irrespective of what the market is doing.
Over the past couple of years I have been tracking my portfolio against the Vanguard Lifestrategy 80 and am coming to the conclusion that for the time I spend researching investment ideas I will be better off spending that time on my other ventures and investing directly into Vanguard.
Look forward to catching up with you at the next FIRE Escape.
Richard
Thanks Richard.
As I’ve not been investing that long (less than 2 years), I quite enjoy spending time researching investment ideas and tinkering about with my portfolio.
At some point though, when I’m less inclined, I can see me lumping it all into Vanguard, either all in a LifeStrategy fund or just a bunch of ETFs.
Yes, hopefully catch up soon!
Better to live through exciting times and all that 🙂
I’ve actually been waiting and hoping for a crash for a while now so am actually rather glad about the whole thing, seeing as we are still in fairly early accumulation stage. It will be nice to average down our cost basis on the various funds and ETFs I’ve been buying.
Saying that… it is quite scary seeing alot of red on the portfolio and knowing that, well it still could have a lot further to go (who knows?!). I think I will try to just ignore most of the noise and only check in properly once per month or whenever I decide to buy some more.
I don’t do a regular saving like yourself, I’m just not organised enough for that and I like to keep my options open, for example if in any given month I feel the market looks too high I can just keep cash or maybe pay down the mortgage instead. It is effectively market timing I guess but it’s just slightly more fun than putting everything on autopilot. I guess you get your buzz in that respect by buying individual shares, which I do not do! 🙂
(I agree with Richard on that front, I just don’t think the hours I would have to put in the research would gain me any extra %age returns and probably more likely to underperform if anything!)
Good luck catching some bargains!
Absolutely, TFS. In a way, I’ve been ‘hoping’ for a crash – rather now than later anyway!
I am hoping to pick up a few shares/investment trusts at a lower price but like you, hoping to average down on some of my existing investments.
Whilst I do invest every month, I still ‘choose’ what to invest in each month, in accordance with my planned allocations. I know I’m taking a big risk by having relatively little cash but for these next 5 years, I just want to throw as much as possible into equities and then step back to see how my allocations need to be adjusted and whether I need to build up cash reserves.
You and Richard are probably right – it’s probable that me picking my own stocks adds little value. Just as well that the bulk of my portfolio is in passive trackers!
Cheers!
Some of the discounts on ITs are widening too in the panic – since you mentioned EMs – FCSS on 20% discount, falling knife or opportunity?
Hey Ermine
Yes, I noticed some widening discounts of ITs with interest. FCSS at 20% though – looks too good to be true, so I’d say probably falling knife!
Hi Weenie,
Just wanted to thank you for the link about Unitisation as I’ve been wondering how to do that for a while. I’ve unitized my Income Fund just in time to watch the value drop in January but that just means I can buy more for less which is always good. Now I need to find a better name than Income Fund which is a bit boring really.
Best wishes,
-DL
Hi DL
I’m glad I was able to help you out with that link. Like you, my fund is down by quite a bit already in January but I’m looking forward to buying more for less too!
Good luck and have fun in seeking a different name for your ‘Income Fund’! 🙂
Hi Weenie, I do wish I still had my regular monthly investment purchase when the markets fall like this. There’s no upsides at times like these when I’m not able to take a slice at the lower levels, apart from reassuring myself that I benefited before (like all through the 2008 crash) so count my blessings. But the ball could still bounce either way, so going slow and steady is still the best bet.
Hi Jim
Were you not tempted to dive in a ‘little’ like Ermine has?
It must be a little weird for you, now that you are spending instead of saving.
Having ridden on the crest of 2008 and onwards, I guess you’ve already benefited somewhat already. Perhaps this will be my kind of 2008? Whilst I wish I had a big wodge of capital to take advantage, I’m ok with with slow and steady!