I put together a portfolio of stocks for myself which I thought about buying at the beginning of this year, for income generation, mainly MLPs, REITs, dividend stocks and bond funds. These would be long term holds for me, not things I plan on trading or selling any time soon.
Only problem is: I didn't buy any of them. I was concerned because most everything was trading at all time highs. There also seemed to be a lot of worry in the market about economic issues.
So now here we are at the end of March and all these stocks I didn't purchase because I was concerned about their high prices have gone up much higher and I would now have substantial profits if I owned them, purely based on price appreciation, never mind the income they generate.
So I am asking myself should I just buy the stocks I wanted to buy in January now? It doesn't look like a good time to buy to me. Global economic news seems pretty bad. The market just keeps going up but it doesn't seem to be based on anything. Indexes are at all time highs. But at the time same time If I wait for these stocks to go on sale, how long will I be waiting? I could really use the income.
On the other hand, I know if a crash does come, all of these stocks are going to get killed and with my luck it would be a few weeks after I finally broke down and bought them. I think of what would have happened if I had bought these stocks just before the 2008 crash. Five years later, I still wouldn't have made up the losses on many of them.
Is it better just to stay on the sidelines and wait, even though I could be missing out on a lot of potential profits?
Would like to get some feedback from the board about this. Thanks.
The market probably has another 10-15% to run by the end of the year. But there will certainly be substantial dips in between. I suspect you missed the entirety of a four year bull market. But at least you weren't dumb enough to short a bull market, as so many of the posters here.
if you are buying things that are optionable then just insure your portfolio like you would a car or house. then it doesnt matter what markets do whether up or down you are protected and still recieve the dividends you want.
buy dividend stocks or ETFs that are optionable . upon your purchase, sell cover calls to generate steady income monthly + dividend.. if underline stocks price drop, you get to keep call premiums.
Yes, most of us piled into the market in that first week in January. The dynamics that have pushed the market up over those 3 months has not changed, the feds will continue to support the markets.
But reading your comments I would say you are not ready for much risk...if you couldn't pull the trigger at the beginning of January then you are probably fairly risk averse, and your comments strike me as someone not ready to stomach much of a downturn if it did happen.
You need to work on clarifying what is your risk tolerance-Are you able to take a 50% loss without cut and running? If you can't have a large enough cushion to weather a market downturn, then you would be better off in some non-callable long-term high grade debt for the time being until these markets get off their crack pipe and back to reality.
Sentiment: Strong Sell