We've had a pretty big rally in bonds especially the long end of government bonds. If you never moved any of your money,especially your 401k money out of bonds you have another chance right now.
The 10 year which went over 2.25% back in the march-april time period is around 1.75% .
Unless you think yields are going much lower,now in my opinion is a good time to get out.
The way bonds work is if interest rates start rising the value of your bonds goes down. If you've been in them for a while its time to think about getting out
Monday, May 14, 2012
Tuesday, May 8, 2012
So here we are again.The market as I type this is down 176. I have been warning my subscribers and clients since April 9th to take at least 25% of their assets in their 401k and put it into moneymarket.
Hopefully anybody reading this did the same .
Today we broke a triple bottom on the S&P 500 at 1350. What that means is that we broke alot of support and we could be heading much lower.The next major support looks to be around 1265 which is approximately 6% lower from here. Of course there is no telling if that support will hold or not. And there is no telling if we reverse back up sooner than that.
The point is that you can't afford to take that chance. Do you remember what happened back in 2008? Do you remember what happened back in 2002? Can you afford to sit there and hope you get back to even in the next 2 years if we have another meltdown?
My point is that if you would have taken off 25% or more you would have some cash to redeploy once this correction is over with.
I want you to know that based on relative strength equities are still favored over cash or bonds at this point. Thats why I have only taken off around 25%.If relative strength changes to favoring moneymarket I will move a substantial amount of money into moneymarket.
As i've said over and over having been doing this for a long time its all about capital preservation. There is no reason not to take precaution with your retirement assets. You can always get back in.
If you have any questions or comments don't hesitate to contact me. By the way how many of you have heard from your financial advisor? And if you have I'll bet he said something like stay the course,be patient,follow the plan. Can you afford to do that--can you afford to lose 20-30% of your retirement assets again?
Hopefully anybody reading this did the same .
Today we broke a triple bottom on the S&P 500 at 1350. What that means is that we broke alot of support and we could be heading much lower.The next major support looks to be around 1265 which is approximately 6% lower from here. Of course there is no telling if that support will hold or not. And there is no telling if we reverse back up sooner than that.
The point is that you can't afford to take that chance. Do you remember what happened back in 2008? Do you remember what happened back in 2002? Can you afford to sit there and hope you get back to even in the next 2 years if we have another meltdown?
My point is that if you would have taken off 25% or more you would have some cash to redeploy once this correction is over with.
I want you to know that based on relative strength equities are still favored over cash or bonds at this point. Thats why I have only taken off around 25%.If relative strength changes to favoring moneymarket I will move a substantial amount of money into moneymarket.
As i've said over and over having been doing this for a long time its all about capital preservation. There is no reason not to take precaution with your retirement assets. You can always get back in.
If you have any questions or comments don't hesitate to contact me. By the way how many of you have heard from your financial advisor? And if you have I'll bet he said something like stay the course,be patient,follow the plan. Can you afford to do that--can you afford to lose 20-30% of your retirement assets again?
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