The Prudent Retiree - Hold or Sell?

Hold or Sell?      

It goes without saying that we are very concerned about the stock market. Why this precipitous decline? The simple answer is more sellers than buyers, but again why? The possible answers are numerous—tariffs, the Fed, disconcerting and unstable behavior in Washington, DC. Likely, it’s a combination of all.

The most important question is what to do now. Hold or sell? Prudent Retiree believes you can’t panic. There needs to be a plan and the discipline to follow it. While it is true that sometimes a “gut” reaction is right, more often than not, you’ll get it wrong. We believe at this moment, the right course is to hold.

We look to history for guidance on what may happen. There are always times of turmoil for one reason or another. Circumstances change on a dime. Let’s examine recent instances of market fear—1998, 2000, 2008, 2011 and 2016. Two of those years—2000 and 2008—saw the start of serious prolonged market declines. In both instances, the market fell, rallied and then collapsed. Right now, this could be an initial drop with a rally to follow before a subsequent collapse.

In 1998, 2011 and 2016, the market experienced violent drops of 15-20% and then rallied and moved higher within less than six months. Very frightening, but short corrections.

Which is it now? We wished we knew, but that’s not possible. We do believe the market is extremely oversold and there may be a rally. Will that rally be temporary or a lasting move higher? Again we don’t know, but that will be a better time to make a decision to hold or sell. Decision time could be next week or next month. Know that we are watching and have a plan.

Here at Horseman Group, we strive to provide you with the highest possible level of customer service. Feel free to reach us at 314.692.7842 with any questions regarding your investments, risk management, or retirement.

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Horseman Group – 3 CityPlace Drive - Suite 290 – St. Louis, MO 63141 – 314.692.7842 – www.horsemangroup.com

Securities and advisory services offered through LPL Financial, a registered investment advisor. Member FINRA/SIPC. The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual. All performance referenced is historical and is no guarantee of future results.
Investing involves risk including loss of principal. No strategy assures success or protects against loss.