Stocking picking fail, how can we turn our retirement portfolio around?

[Anonymous]

DH lost a significant amount this year stock picking in an ETrade account for retirement. His 401k is index funds but he followed Motley Fool with a bunch of overvalued tech companies and that account is down at least 50-60 percent YTD .. possibly more. He won’t tell me. I knew because he did the same to my personal 401k. We lost A LOT. Late 30’s. Some of these may recover like Airbnb and Amazon but some may not. Some are down like 85-90 percent.

After doing a little research I told him at this point forward I want him to just put any money into the S+P 500 index fund.
We have about $200k cash sitting we got from a company stock situation. Luckily we had planned to use that for something that didn’t pan out so it’s been sitting in cash all year and was not put into this super volatile account!

Where should we put that if we may need it in the next 1-2 years?

What should our investing strategy be moving forward? Right now we have several hundred thousand in these individual stocks with no plans to sell but I told him we cannot continue this strategy. IF they are winners long term we have enough risk now.

[Anonymous]

Troll?

I've seen a similar thread twice before.

[Anonymous]

You sound extremely uninformed.

1. This year, there's been a market correction. Your portfolio would have tanked anyway.
2. You're young. You'll recover nicely.
3. DO NOT SELL. Keep the tech, it will do well in the future.
4. When market reaches bottom in the next few weeks and months, buy more stock. I'm buying more tech.

The only thing we agree on is that you should steer your own portfolio.

[Anonymous]

Anonymous wrote:You sound extremely uninformed.

1. This year, there's been a market correction. Your portfolio would have tanked anyway.
2. You're young. You'll recover nicely.
3. DO NOT SELL. Keep the tech, it will do well in the future.
4. When market reaches bottom in the next few weeks and months, buy more stock. I'm buying more tech.

The only thing we agree on is that you should steer your own portfolio.

Yes, it would have tanked but not 60+ percent. That’s too much. Our entire portfolio should be 15-20 individual tech stocks that were suggested by Motley Fool. Random companies like Lemonade... We aren’t selling but at this point I don’t want to buy a bunch of speculative individual stocks. We are continuing to put more in the market but we need to put it in index funds. If it was even like 20-30 percent fine but 60 percent in a year is insane.

[Anonymous]

sorry should NOT be 15-20 individual stocks

[Anonymous]

Warren Buffet says put your money in the S+P 500 index. Pretty sure his strategy works for long term growth

[Anonymous]

How much did you lose?

[Anonymous]

Anonymous wrote:

Anonymous wrote:You sound extremely uninformed.

1. This year, there's been a market correction. Your portfolio would have tanked anyway.
2. You're young. You'll recover nicely.
3. DO NOT SELL. Keep the tech, it will do well in the future.
4. When market reaches bottom in the next few weeks and months, buy more stock. I'm buying more tech.

The only thing we agree on is that you should steer your own portfolio.

Yes, it would have tanked but not 60+ percent. That’s too much. Our entire portfolio should be 15-20 individual tech stocks that were suggested by Motley Fool. Random companies like Lemonade... We aren’t selling but at this point I don’t want to buy a bunch of speculative individual stocks. We are continuing to put more in the market but we need to put it in index funds. If it was even like 20-30 percent fine but 60 percent in a year is insane.

PP you replied. 100% of my Roth IRA is individual stocks I picked myself. I've done better than if I'd chosen an index fund. -60% is not insane in the current context, which is a highly unusual one and not likely to occur regularly, but I agree that you should pick stocks you've researched and feel strongly about, not pick them just because someone else recommend them! You have to buy this year, OP, to compensate for that loss. Buy an index fund if you're jittery about picking stocks yourself, but take advantage of the bottom that's coming up.

[Anonymous]

I was in my early 30s in 2008/9. I had just put $50k in a Vanguard account in different funds. I lost 50% over a few months. I was terrified. However I knew better than to pull all my money out at the bottom. I revised my approach - left much if it untouched and focused on buying low and diversification over the next 10 years. I just didn’t look at the total for years and kept my head down. I’m sitting on a pretty high balance now due to the incredible stock market performance over the last 10 years or so.

Lesson - get a handle on what your current investments are, don’t freak out and pull out of the market, come up with your own philosophy and tell him to stay away from your 401k.

[Anonymous]

Anonymous wrote:How much did you lose?

Not sure the exact amount, a few hundred thousand.

[Anonymous]

Again we aren’t pulling it out of the market but I was more diversification for our retirement than 100 percent all high growth tech stocks that are overvalued buys.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:You sound extremely uninformed.

1. This year, there's been a market correction. Your portfolio would have tanked anyway.
2. You're young. You'll recover nicely.
3. DO NOT SELL. Keep the tech, it will do well in the future.
4. When market reaches bottom in the next few weeks and months, buy more stock. I'm buying more tech.

The only thing we agree on is that you should steer your own portfolio.

Yes, it would have tanked but not 60+ percent. That’s too much. Our entire portfolio should be 15-20 individual tech stocks that were suggested by Motley Fool. Random companies like Lemonade... We aren’t selling but at this point I don’t want to buy a bunch of speculative individual stocks. We are continuing to put more in the market but we need to put it in index funds. If it was even like 20-30 percent fine but 60 percent in a year is insane.

PP you replied. 100% of my Roth IRA is individual stocks I picked myself. I've done better than if I'd chosen an index fund. -60% is not insane in the current context, which is a highly unusual one and not likely to occur regularly, but I agree that you should pick stocks you've researched and feel strongly about, not pick them just because someone else recommend them! You have to buy this year, OP, to compensate for that loss. Buy an index fund if you're jittery about picking stocks yourself, but take advantage of the bottom that's coming up.

We are still buying and investing in our retirement as paychecks come in but I’m not putting that cash in because we need it for the short term (DP on a rental property)

[Anonymous]

Anonymous wrote:Troll?

I've seen a similar thread twice before.

Yeah I remember that thread too about the DH that invested heavily in tech and lost money.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:You sound extremely uninformed.

1. This year, there's been a market correction. Your portfolio would have tanked anyway.
2. You're young. You'll recover nicely.
3. DO NOT SELL. Keep the tech, it will do well in the future.
4. When market reaches bottom in the next few weeks and months, buy more stock. I'm buying more tech.

The only thing we agree on is that you should steer your own portfolio.

Yes, it would have tanked but not 60+ percent. That’s too much. Our entire portfolio should be 15-20 individual tech stocks that were suggested by Motley Fool. Random companies like Lemonade... We aren’t selling but at this point I don’t want to buy a bunch of speculative individual stocks. We are continuing to put more in the market but we need to put it in index funds. If it was even like 20-30 percent fine but 60 percent in a year is insane.

PP you replied. 100% of my Roth IRA is individual stocks I picked myself. I've done better than if I'd chosen an index fund. -60% is not insane in the current context, which is a highly unusual one and not likely to occur regularly, but I agree that you should pick stocks you've researched and feel strongly about, not pick them just because someone else recommend them! You have to buy this year, OP, to compensate for that loss. Buy an index fund if you're jittery about picking stocks yourself, but take advantage of the bottom that's coming up.

We are still buying and investing in our retirement as paychecks come in but I’m not putting that cash in because we need it for the short term (DP on a rental property)

Your loss then. It's the way to compensate for losing 60% earlier this year.

[Anonymous]

Anonymous wrote:Again we aren’t pulling it out of the market but I was more diversification for our retirement than 100 percent all high growth tech stocks that are overvalued buys.

I think you may want to consider doing something like 80% in some combination of large/medium/small cap, with the other 20% in individual tech stocks (to scratch that itch and have that portfolio of lottery tickets that could pay off big). Or 70/30 depending on the dynamic (but 50/50 is too aggressive IMO). Of course, invest in your I-bonds as well.