Wednesday, January 1, 2020

Time to Take Stock Profits? 4 Steps to Consider Now

Here is the article.

History would suggest that a pullback is highly likely because the stock market, as measured by the S&P 500 index, is up over 336% from March 2009 to late July 2017 (19% annualized). It’s probably safe to assume that the stock market, which has averaged 10% per year since 1926, can’t sustain its current 19% pace forever.

Facts:

the stock market, as measured by the S&P 500 index, is up over 336% from March 2009 to late July 2017(19% annualized)

Argument:

How come I did not know at all, I did not spend time to look into S&P 500 index? 
Only thing I wondered if I should invest Amazon stock. I went to Amazon onsite in 2016 June 8. 

I chose not to study personal finance, investment, and how the capitalism works in Canada or USA from 2001 to 2018 December. 


Facts:

If these skewed figures don’t make you want to examine your portfolio further, consider that we are also in the second-longest and second-largest bull market since World War II, and we are sitting in the middle of the second most pricey market since the 1999 tech bubble (as measured by P/E ratios).

Your portfolio? What I did is to put everything to IRA CD with Amtrust bank with 1.1% interest. My Par 401 K is in money preservation. 

second-longest and second-largest bull market since World War II 
P/E ratios - second most pricey market 

Statements:

If you own a portfolio of individual stocks or stock funds, it is likely that a couple of them have been on fire since 2009. For example, Apple is up 1,294% since March 2009, and Amazon is up 1,595%. If you’ve owned these two companies, then congratulations. However, you are likely sitting heavily in these two positions now.
Facts:

Apple stock is up 1,294% since March 2009 to August 2017. 10 times more value. 
Amazon stock is up 1,595% since March 2009 to August 2017. 15 times more value. 


Notes:

  • Mutual fund performance numbers were obtain from Morningstar Office
  • Bull Market: prices that continue rising without being interrupted by a 20% decline
  • Longest bull market, 10/1990 to 3/2000, 114 months, current bull market 101 months, no bull market has made it to its 10th year anniversary. We are at 8.4 years.
  • Largest bull market, 10/1990 to 3/2000, 417%, current bull market 336%
  • S&P 500 P/E at end of bull market, 3/2000: 28.9, current P/E 26.2
  • S&P 500, 3/9/09 to 7/21/17, 336%

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