Entire stock portfolio down 50% in one year

[Anonymous]

Anonymous wrote:

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Anonymous wrote:Is this 50% from the peak or 50% of what he has put in? A lot of my growth stocks have lost 75-80٪ from their peaks but that doesn't mean I've lost that much. Plus most of my money is in vtsax to balance it out

I still think you're better off holding especially if in 401k since you can't tax loss harvest either.

For my personal account which he rolled over in March 21 it’s down 50 percent. Very frustrating. He said these are long term picks. I just don’t agree. Bad choices and gambling in my opinion. He bought at the highest point. They have been down all year with the exception of one.

It doesn’t really matter how much they are down. How far are you going to take your disagreement over investment choices?

I’m pushing to get a financial adviser for the family. Yes you can save a few percent to handle it yourself but since we have conflict over how it should be handled AND we are losing money and not doing great with our investments it makes sense in our situation. This has been the major thing we fight about since we have been married. We have been lucky with income and equity but if we continue down this path of taking risky investments we will continue to likely lose more and more. I personally would rather be conservative and comfortable than have the chance to be really rich.

That’s a good idea to consult an advisor but you are still both on very different pages. Your DH clearly wants to take high risk high reward opportunities and you want conservative. Somehow you will need to come to agreement. Maybe you split the investments and you follow your different approaches with a portion of the total. This is more of a relationship issue than a financial one.

[Anonymous]

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Anonymous wrote:My husband took all our money out of index funds and put in personal tech stops and it dropped 50% this year. My husband did this. I'm so scared and don't know what to do in our situation. He won't talk about it and calls me a fool to take the money out of the market now. I'm so angry to be in this situation.

Well, he made a bad choice, but he's right about your proposed course of action now. Don't compound (and lock in) his mistake with your own.

Some of those stocks at worth 80% of what they were a year ago. You really think it's just going to have a big turn around putting 10% of our portfolio in some random telecdoc company? If he played index funds the most we would love in a year is like 10 percent even in a recession. No one's stock portfolio should drop FIFTY PERCENT IN ONE YEAR if they are being moderate. I told him take $20k of money we can afford to lose and gamble with whatever you want to pick but don't make risky choices with our family's future.

In an index fund you can lose 20-30%+ in a year. You can also earn nothing over a decade. Ask me how I know. It just hasn't happened since 2008. But us older folks know it happens regularly. And may be starting to happen again. You never know. Your DH bought high, but those are long-term bets. The pandemic was a very weird time for investors as crazy things ran up--and it intersected with the Motley Fool picks (plus some other tech growth recommendations) he seems to have been relying on. Growth investing means buying companies that are not yet profitable and taking a chance that a couple of your 20 or so picks will go up 300%+ to make up for losses in others. It's moderately aggressive, not wildly speculative. What he should learn from this is that you have to look more carefully at the price of the stocks you buy (something that MF doesn't emphasize)--and if he's not willing to do that to just stick with index funds. But I would let these picks ride out rather than selling. He might turn out to be right in the 5 year view. You are in the accumulation phase, stick with S&P500 and/or VTI and keep about 10% of your portfolio for stock picking.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:My husband took all our money out of index funds and put in personal tech stops and it dropped 50% this year. My husband did this. I'm so scared and don't know what to do in our situation. He won't talk about it and calls me a fool to take the money out of the market now. I'm so angry to be in this situation.

Well, he made a bad choice, but he's right about your proposed course of action now. Don't compound (and lock in) his mistake with your own.

Some of those stocks at worth 80% of what they were a year ago. You really think it's just going to have a big turn around putting 10% of our portfolio in some random telecdoc company? If he played index funds the most we would love in a year is like 10 percent even in a recession. No one's stock portfolio should drop FIFTY PERCENT IN ONE YEAR if they are being moderate. I told him take $20k of money we can afford to lose and gamble with whatever you want to pick but don't make risky choices with our family's future.

In an index fund you can lose 20-30%+ in a year. You can also earn nothing over a decade. Ask me how I know. It just hasn't happened since 2008. But us older folks know it happens regularly. And may be starting to happen again. You never know. Your DH bought high, but those are long-term bets. The pandemic was a very weird time for investors as crazy things ran up--and it intersected with the Motley Fool picks (plus some other tech growth recommendations) he seems to have been relying on. Growth investing means buying companies that are not yet profitable and taking a chance that a couple of your 20 or so picks will go up 300%+ to make up for losses in others. It's moderately aggressive, not wildly speculative. What he should learn from this is that you have to look more carefully at the price of the stocks you buy (something that MF doesn't emphasize)--and if he's not willing to do that to just stick with index funds. But I would let these picks ride out rather than selling. He might turn out to be right in the 5 year view. You are in the accumulation phase, stick with S&P500 and/or VTI and keep about 10% of your portfolio for stock picking.

Thank you, this was helpful.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:My husband took all our money out of index funds and put in personal tech stops and it dropped 50% this year. My husband did this. I'm so scared and don't know what to do in our situation. He won't talk about it and calls me a fool to take the money out of the market now. I'm so angry to be in this situation.

Well, he made a bad choice, but he's right about your proposed course of action now. Don't compound (and lock in) his mistake with your own.

Some of those stocks at worth 80% of what they were a year ago. You really think it's just going to have a big turn around putting 10% of our portfolio in some random telecdoc company? If he played index funds the most we would love in a year is like 10 percent even in a recession. No one's stock portfolio should drop FIFTY PERCENT IN ONE YEAR if they are being moderate. I told him take $20k of money we can afford to lose and gamble with whatever you want to pick but don't make risky choices with our family's future.

In an index fund you can lose 20-30%+ in a year. You can also earn nothing over a decade. Ask me how I know. It just hasn't happened since 2008. But us older folks know it happens regularly. And may be starting to happen again. You never know. Your DH bought high, but those are long-term bets. The pandemic was a very weird time for investors as crazy things ran up--and it intersected with the Motley Fool picks (plus some other tech growth recommendations) he seems to have been relying on. Growth investing means buying companies that are not yet profitable and taking a chance that a couple of your 20 or so picks will go up 300%+ to make up for losses in others. It's moderately aggressive, not wildly speculative. What he should learn from this is that you have to look more carefully at the price of the stocks you buy (something that MF doesn't emphasize)--and if he's not willing to do that to just stick with index funds. But I would let these picks ride out rather than selling. He might turn out to be right in the 5 year view. You are in the accumulation phase, stick with S&P500 and/or VTI and keep about 10% of your portfolio for stock picking.

Thank you, this was helpful.

OP. You should also read up on stop losses and insist on setting good stops. For example, a trailing stop loss of 10% would automatically sell the stock if it drops by 10%. On the other hand, if the stock keeps moving up, the stop also moves up with the stock but kinda freezes when the price starts moving down. If you buy a stock for $100, set a stop loss of 10% and the market starts tanking, the system will sell your shares at $90. On the other hand, if the stock starts to take off and goes to $150 over the next week, then turns around and starts going the other way, the stop will trigger at $135 (10% below $150). Of course, there are several nuances - picking the right stop, should it be based on ask, bid or mid, etc. Every brokerage has videos on it.

If your DH had stops set up, you would have been out with a smaller loss and maybe even have bought back into the same stocks at a 50% discount.

[Anonymous]

This is why people say diversify. Your husband is an idiot and so are you.

[Anonymous]

Anonymous wrote:How old are you guys? If you don't need the money in the next 5-10 years, you should be fine. Hopefully, the companies are solid.

Most important question by far.

[Anonymous]

I experimented this year by buying individual stocks to see if I could beat the market - just for fun. I only put a few thousand in but I’m down 5.8% as of today (and it’s gone up recently from a larger dip). If I invested in index funds I’d be down 1%. I think it’s great to experiment but on a smaller scale.

[Anonymous]

Anonymous wrote:

Anonymous wrote:How old are you guys? If you don't need the money in the next 5-10 years, you should be fine. Hopefully, the companies are solid.

Most important question by far.

30's

[Anonymous]

Anonymous wrote:This is why people say diversify. Your husband is an idiot and so are you.

Rolling eyes at your moment of feeling superior.

[Anonymous]

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Anonymous wrote:He's been listening to too much Cathy Wood. That's a YOLO portfolio right there.

What’s that?

Not Cathy this is a Motley Fool rec list

Yep, spot on. DH follows Motley Fool.

Our equity won’t go down. Our area isn’t DC. May not go up as much as it has but it won’t drop. We have $200k left on our mortgage so this is very safe for us. We will never be underwater on our home.

Motley Fool? https://www.bogleheads.org/forum/viewtopic.php?t=66350 My condolences. They used to be helpful, but now they are just shills.

I don't think you understand equity. Your equity absolutely can go down. Sure, you have almost paid off your mortgage, so you are unlikely to be underwater, but your equity could absolutely drop and your net worth with it.

Sure you aren't in DC, but I can't think of many places where a $1.7M house is immune to recession. Remember once Detroit was Silicon Valley... https://www.politico.com/news/2020/12/18/silicon-valley-bay-area-business-model-448065 . Maybe you are on Hawaii? But island life gets way less attractive with high fuel costs making EVERYTHING outrageously expensive (for example).

Our area won't go down though.We are experiencing super high growth. It may not see the gains of this year but with a 200k mortgage on a house valued at 1.7 we are in a very good position with this. Also my decision to buy the house.

What area? Rapid growth recently has been in places dependent on WFH continuing

Austin (rollingwood)

Austin tops the lists of a lot of bubble lists, can sprawl on forever, and suffers from being under Texas governance.

It seems likely you bought a decade ago, and your $500k home is now worth $1.7M? I would not hang my hat on that equity, and make darn sure your DH doesn’t take a HELOC for more investing money.

I don’t think so. We are one mile from downtown
Zillow estimate is 1.9, 1.7 is conservative.

So you both suffer from Hubris. Who the F cares about downtown anymore?

Austin isn't going down. A lot next door just went pending for 2.2.

Oh, well then. You have proven there is no bubble. Carry on.

DP. Those of you banging on about OP’s house being overvalued are barking up the wrong tree. Unfortunately (because I think it’s ruined a city I used to love), Austin is the fastest growing city in the US as a % of population. Austin added 400,000+ new residents between 2010 & 2020, & 67,000+ of those were in 2020 alone. A significant % of those are people from higher cost areas who have a lot of equity to spend. In comparison, DC (where prices have also risen) has seen net out-migration. If Austin is a bubble, DC is in a world of hurt. Especially since the infrastructure hasn’t kept up & traffic is a mess, close in houses like OP’s will sell for a premium.

https://www.austinchamber.com/blog/02-08-2022-migration

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:My husband took all our money out of index funds and put in personal tech stops and it dropped 50% this year. My husband did this. I'm so scared and don't know what to do in our situation. He won't talk about it and calls me a fool to take the money out of the market now. I'm so angry to be in this situation.

Well, he made a bad choice, but he's right about your proposed course of action now. Don't compound (and lock in) his mistake with your own.

Some of those stocks at worth 80% of what they were a year ago. You really think it's just going to have a big turn around putting 10% of our portfolio in some random telecdoc company? If he played index funds the most we would love in a year is like 10 percent even in a recession. No one's stock portfolio should drop FIFTY PERCENT IN ONE YEAR if they are being moderate. I told him take $20k of money we can afford to lose and gamble with whatever you want to pick but don't make risky choices with our family's future.

In an index fund you can lose 20-30%+ in a year. You can also earn nothing over a decade. Ask me how I know. It just hasn't happened since 2008. But us older folks know it happens regularly. And may be starting to happen again. You never know. Your DH bought high, but those are long-term bets. The pandemic was a very weird time for investors as crazy things ran up--and it intersected with the Motley Fool picks (plus some other tech growth recommendations) he seems to have been relying on. Growth investing means buying companies that are not yet profitable and taking a chance that a couple of your 20 or so picks will go up 300%+ to make up for losses in others. It's moderately aggressive, not wildly speculative. What he should learn from this is that you have to look more carefully at the price of the stocks you buy (something that MF doesn't emphasize)--and if he's not willing to do that to just stick with index funds. But I would let these picks ride out rather than selling. He might turn out to be right in the 5 year view. You are in the accumulation phase, stick with S&P500 and/or VTI and keep about 10% of your portfolio for stock picking.

This is good advice. However, I would consult financial advisor, and evaluate each stock individually. There is no point riding a stock all the way to the bottom is it really has no fundamentals.

[Anonymous]

Ived learned that stocks don't make sense and it's speculation and manipulation. If they made sense ask those companies should never do because it's tech and the future, and gm, big box stores should all be bankrupt and done. I don't trust the stock market, especially after seeing how walstreet bets proved them markets could be manipulated and had nothing to do with company earnings and growth

[Anonymous]

Anonymous wrote:My husband took all our money out of index funds and put in personal tech stops and it dropped 50% this year. My husband did this. I'm so scared and don't know what to do in our situation. He won't talk about it and calls me a fool to take the money out of the market now. I'm so angry to be in this situation.

Tell him to get off Wallstreetbets.

[Anonymous]

Anonymous wrote:

Anonymous wrote:Someone wise in Bogleheads told me once, “You only lose when you sell.”
Eventually his portfolio will go back up and you will have a lot of money again.

Or they won't.

Looking at the actual stocks her husband picked, they look like a bunch of trash companies that ran up during the pandemic and have been getting crushed for the last 6+ months:

AMWL: American Well Corporation
YI: Some online COVID testing company
TDOC: Teledoc some online telehealth company
AMZN: Amazon, well they have held steady enough
LMND:Lemonade, an online insurance company
NEE: Next Era Energy, ok they have held up
ABNB: maybe ok, who knows.
MASI: Masimo, another telehealth company
PGNY: Progyny, some other healthcare online company
FROG: I have no idea what this company does but the 5 year chart is a straight line from 87 a share to 21 dollars a share. Looks like a dog
FSLY: Again I have no idea what this company does but 5 years ago it was worth ~12 a share during the pandemic it jumped up to 120s and then straight back to 12 again

and so on. These are some of the worst stocks you could find, I have no faith in any of them except perhaps amazon. Your husband is the stock picking equivalent of a drunk driver, you need to take away his keys.

PTON-Peloton. Remember when it was over 100? Despite having plenty of fresh air scenic opportunties for hiking/walking with no drive to get there, my DH did a pandemic treadmill purchase. Not Peloton and the thing is still taking up space and not assembled.

We dumped our financial advisor and be aware that all do not have a fiduciary responsibility. Orders to buy or sell were not executed as fast as I wanted
and too much dialogue against what I wanted to buy. One argument was a USA only company that provides an essential service. Nothing fancy or funky. Not dependent on sales or pandemic related products. Bought at about 80 in the original pandemic doldrums and now it's over 125. Just rebalanced itself and chuggs along with no serious Ukraine impacts. Same thing for a bank that is domestic.

[Anonymous]

Anonymous wrote:This is why people say diversify. Your husband is an idiot and so are you.

I gotta agree.

People like thr OP really should.just be using platforms like wealthfront. If they are this clueless in their 30s it's not going to get better.