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What Should You Do???

Dec. 21, 2021 10:05 AM ETiShares Russell 3000 ETF (IWV)
Jim Van Meerten profile picture
Jim Van Meerten's Blog
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  • Do what you always do.
  • Be rational and do not panic.
  • Be disciplined.

Today I want to encourage you to stay rational and true to your discipline.  I personally have 2 separate portfolios:

One is a broad based ETF portfolio with 10 holding of 70% stocks, 15% Private Equity and 15% REITs.  I have stop losses set at the 200 day moving averages.  After a sale I buy back at the 50 day moving average.

The second is an individual stock portfolio again of 10 positions.  I have a stop loss on each position at the 100 day moving average but consider selling if the Barchart opinion drops below 50% or I have a loss at the 3 month mark.  After a sale if the market is declining I keep my powder dry until I see upward support and then use my screening process to decide what to buy.

I encourage you to have a similar discipline.

I always keep 2 benchmarks in mind:  The Russell 3000 Index (3000 stocks in a Cap weighted index) and the Value Line Arithmetic Index (1700 stocks in an equal weighted index).  If you follow just these two indices you know where the market is headed and can make rational and intelligent investing decisions.

First the Russell 3000 Index:


and then the Value Line Arithmetic Index:


I think you will agree that although both are off their high water mark and declining but there is no need to panic.

Always keep your stop losses in place.  Determine ahead of time your sell points.

Keep your powder dry until you feel comfortable to reenter the market.

Determine ahead of time how you will select your new positions.

Remember there are just 3 keys to being a successful investor:  Discipline, Discipline and Discipline.

Health, Wealth and Time to enjoy them both.

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