Just don’t look at it, @1214mom, it will only scare you. Avoid, avoid!
“I admire your returns from 2015 @DocT and that is a solid fixed annuity too. What state is your W’s teacher retirement in?”
The investment method worked well last year. I’m not certain it will work so well this year. Sometimes you have to be flexible. My wife is a principal in Connecticut.
Vanguard can set up RMDs automatically. I would expect that most mutual fund companies would be able to do so, and if they were supposed to and didn’t, I’d get a letter from them (or find your documentation that said they’d do it annually) to send to the IRS with a request to waive the 50% penalty.
I inherited a small retirement account, and the person I inherited it from was 70 when he died. It took several calls to Hartford to figure out when I had to start taking the RMD. I HOPE they got it correct.
I am happy for you. Your retirement funds are quite high. I don’t have much to loose that much. I invest 100% in stock funds too.
@busdriver11 I respectfully disagree. I learned a very valuable lesson from William O’Neil. The number one thing you should do while investing is have a stop loss. His is 7-8%. Mine is much less than that. He says it is easy to make 8% back. It’s true. It is much harder to make back a 50% loss - you have to make 100% to get it all back. His point is preserving your capital is paramount. That is why you have to stops to protect your capital so you can invest another day.
Just take a look at year 2000 - the Nasdaq dropped 78%. If you had 1,000,000 - you lost 780,000! That drop was fast and furious - dropped in just over a year. If you had followed the loss rule of 8% you would have only loss 80,000. However, you have 920,000 in your bank account vs. only having $220,000 (1m- 780k). You only have to make 8.7% to get the 80k back. However, you’d have to make 345% to get your 780,000 back which is unrealistic and very difficult. If you had taken the 8% loss you could invest again when the time was right and then made even more instead of trying to make it all back. So his point is preserving your capital is PARAMOUNT.
All markets don’t come back. We’ve been very lucky the Nasdaq came back but it took 16 years for it to come back to 2000 levels.
I’ve watched many of my father’s friends lose their money so this was a hard and free lesson I learned from them. In fact one friend actually had 1M and she lost 750k in the market and only had 250k left (happened in 2000-2001). That’s crazy!
You can read his book - How to make money in the stock market by William ONeil. It was the best $10 I ever paid.
I found his quote: “I make it a rule to never lose more than 7 percent on any stock I buy. If a stock drops 7 percent below my purchase price, I will automatically sell it at the market – no second-guessing, no hesitation”. “The whole secret to winning in the stock market is to lose the least amount possible when you’re not right.”
newjersey17, yeah, you’re probably right. However, we’re not so good at playing or timing the market at all. We have found it’s better to just dollar cost average. Otherwise, I manage to lock in a loss, and the next day, the market skyrockets. We aren’t planning on withdrawing until we have to, at age 70 1/2 anyways, so it’s for the long term, and we would do minimal withdrawals at that time anyways. I figure you haven’t really lost your money unless you sell, then you guarantee that loss. But if you dollar cost average, you’re still buying at the low price.
My parents have had all their money out of the market for awhile, thinking they were doing something dumb, but maybe they were the smart ones after all.
The (relatively) easy part is setting rules for when to get out of the market. Much more difficult is deciding when to get back in. Everyone knows people who sat on the sidelines, holding cash, during this last bull market, waiting for a serious pullback to get back in. Luckily for them, the markets obliged :))
Do not forget that if you are stopped out in a taxable account, you will have to pay CG tax in addition to broker’s fees. Also, short sale rule could apply if you repurchase…
The mutual fund that opened based on O’ Neill’s rules was a disaster
I assume O’Neill’s rules do not apply to index funds, boglehead type investing. They say buy when the prices drop to keep the allocation steady.
If you’re retiring soon like me, what is going on in the market is a perfect example of why you should have money reserved to ride this out. It is also wise to be hedged.
We lucked out. We didn’t hedge, don’t know what that means but we converted most of our 401k to cash last year in preparation to cashing it all out when we fully retire at the end of June. About 10% is still in equity. If the market doesn’t recover, we will have some loss on the remaining 10%.
Well, the top was easy to identify. I would just take your stop % and apply it to the 52 week high against the sp 500 or nasdaq. Once it hits that - sell and go to cash. You could do the same for the bottom. Wait until it reaches 8% off the low and then buy. For example, in 2000 when the nasdaq fell 8% from 5200 - sell. Buy a year and half later when it went up 8% above 1100. 8% is just a number - it can be whatever you choose. You can go back and test this strategy and see if it works for you.
@parent1337 I’m only addressing WO #1 trading rule - how to preserve your cash so you are able to invest another day. I dont’ know anything about his mutual fund.
I sold 100 shares of GILD today. I also sold 100 shares of SPWR.
I hated to do that. But I figured if I sold 100 shares of each stock, I would make the lows and GILD, SPWR and other stocks could rally. 
^ Way to take one for the team. 
It’s working so far.
I covered my short position on spy this morning. Unfortunately it wasn’t at the low today.
@newjersey17 If only it was so simple. I looked back at the timeframe you mentioned in your example. Using your method, you would have been in and out of the market multiple times in 2000 and 2001, most for losses. Being whipsawed is a serious side effect of methods like you describe.
I am hoping that because today was the last day to trade crude oil for Feb on the CME, a little pressure will be removed from the oil market. If you didn’t want to take delivery, you had to sell or roll your position today.
And if a little pressure is removed from the oil market, maybe a little pressure will be removed from the stock market.
I could be full of it. 
http://www.cmegroup.com/trading/energy/crude-oil/light-sweet-crude.html