What to Do if You're a Long Term Investor

That was a wild week.

I'm a long term investor now - mostly. I run the Krypto Fund & look to get 10% per year for it [mostly retirement money in index funds] and the Alpha Fund [stocks that I pick] where I look to get 30% per year.

So here's what I do & what you should do or be doing.

You've been following the general news & world events and know that nothing significant occurred last week regarding the long term prospects for world economic growth. And you know that pullbacks in a bull market are sharp & swift [you do know that NOW at least]. So if you look at the S&P 500 chart, you quickly see that this week fit that pattern precisely. So you will do nothing big. No wholesale liquidation. You'll just "tweak" your investments IF needed.

The big money in long term investing is made by SITTING, not getting whipsawed around. I heard a study of a famous mutual fund. The returns of that fund were phenomenal for about two decades. But when the performance of individual investors in that fund was examined, their returns stunk. Why? They moved money in & out of the fund at the poor times. All they really had to do was just invest using time diversification [see post a few days ago] & hold on. They let their emotions rule, not their brains.

So what do you do NOW? For your retirement money, just examine your asset class allocations this weekend. See if any class is out of its range.

I just did that for the Krypto Fund. Nothing was far enough away from its target percentage to do anything, but my gold & silver allocation is getting close to giving me a buy signal. I'll watch it for now.

For your stocks if you are running an Alpha Fund for yourself like me, look them over. You've been paying attention to the news & will know if the prospects for any stock or industry have changed a lot. If so, make a move. If not, do nothing. If you have some idle cash, perhaps a stock needs more added. Or perhaps a stock you've been thinking about starting a position looks good now [check the chart !]

My Alpha Fund's oils & miners & AAPL & GOOG & ORCL look OK to me. The India stocks I just let ride for the very long term. The China & India growth story is intact. So I'm doing NOTHING, except that I added to GOOG this week due to its great relative strength per a post I made.

That's it - you're done.

PS: Don't listen to the hucksters & bigmouths on Bubblevision. The channel has lots of good info, but they're not part of it.