Despite the market hitting all time highs again this week, I'm looking to exit the market. Well, not completely, but definitely with my peripheral holdings that are profitable, and a significant part of our core holdings.
I've already gone to 100% Cash/CDs in my daughter's 529 account. Since then I've been scaling out of our investments in smaller chunks. I sold parts of the peripheral holdings in my personal investment strategies. I've been taking profits in stocks that were purchased in November/December 2018. I've been selling part of some core holdings (specifically REITs) that are up significantly.
Yesterday, I gave instructions on selling a big piece, closing out one of the investment managers at a brokerage. The manager has done acceptably well, but again, I prefer to lock in the gains that have occurred to date. The close out will happen later next week, so I won't mind the market continuing to advance through next week.
Everything is on the table for selling, except my company stock, which I am holding to do an NUA. By the end of May, I plan to exit another investment manager account.
Why all the sudden selling?
- First, on yield curve inverted in late 2018, and another yield curve inverted in March 2019. Typically, a recession has occurred 7-24 months after a yield curve inversion.
- The rebound from the December 24, 2018 lowest has been parabolic. Our gains in the first four months of 2019 would be a good return for most entire years. It can't continue at this rate, and if it does, a market crash is very likely.
So I am selling early, know full well that I may miss out on some gains. But that's a risk I'm willing to take to sleep better at night.
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This is not financial or investment advice. Please consult a professional advisor.
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