Sell?

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3rd Apr by epo001

12 comments 751 reads

Seen on Xitter

The crash that started the great depression took a huge tumble over about *a week*, and then a further tumble over about *6 weeks* but it didn't bottom out for a further *3 years*.

Is now the time to be out of the stock market? Markets are going to be unsettled and reciprocal measures or new non-US trading alliances will only propogate the situation.

I'm going to sleep on it but I suspect I am going to be mainly in cash tomorrow.

In time buying opportunities will emerge but for now what are the alternatives to sitting on cash?

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About the Author

Epo001

Premium Member

12 comments

The Phoenix

3rd Apr

Short dated bonds or gold would be my starting point but given gold currently near a high I would look to be buying a position in stages.

Chris Brown

3rd Apr

I went from c.20-25% cash yesterday to 60% cash first thing this morning. And I might raise that to 75% tomorrow.

After a terrible period for UK small caps, due to relentless outflows, we now have the US disintegrating. It feels like 2025 will be a down year and I'm not sure I can take the frustration any more!

I'm mostly in the iShares UltraShort £ Bond ETF (ERNS) which currently yields around 4.75% with almost zero risk to capital.

On Gold: it must be the most popular asset in the world right now, so I wouldn't be surprised if it also has a material pullback. Down today.

Govt bonds should in theory be interesting, but I expect a pick up in inflation later this year - made worse by tariffs - so I wouldn't bet on long dated treasuries or gilts making material gains.

I'm basically out and expect it may be a while before the coast is clear. I think a US recession is moving from unlikely to probable with every passing day, and the time to re-invest might be when that's at its nadir. It could be anytime from Q3 25 to Q2 26, really. Labour are providing absolutely no impetus for the UK market to rally on its own.

GloucesterBob

4th Apr

Sold my rather hefty Scottish Mortgage Investment Trust (LON:SMT) today as its dropped 20% recently ands they are too intertwined with America, and who knows what will happen there if China and the EU decide not to play ball and retaliate.

Polar Capital Holdings (LON:POLR) is another candidate but the dividend I am getting on my buy price is too enticing and which wait that one out.

Anything else I will wait to see if it hits my -20% drop from its highest point and let my non emotional stop loss kick in. I have ignored it before to my peril.

epo001

4th Apr

ERNS looks interesting, could people share where they get information about short dated bond or precious metal ETFs?

I am culling now, my beloved GAW has gone (ex-divi, highly priced and US exposure), SMT has gone. For now keeping holdings which derive all their revenue from the UK.

TimeAndTide

6th Apr

I liquidated all my equity ETFs on Friday, I can’t see any way to positive news over the next few weeks and a real risk of a proper rout.

JSchoffer

6th Apr

A few stop losses were triggered last week for me at around -15%. I'll likely just wait and go with the trend either buying shares or shorting indexes, I'll happily change stance to take whatever the market wants to give me!

Glen Keedy

6th Apr

I would echo the sentiments of GlosBob in that if you have a system then stick to it, especially in difficult markets. For example, Paul Scott says the current price isn’t of interest so he doesn’t want to sell and the company circumstances haven’t changed. Cockney Rebel says he sold almost everything before the tariff announcement. Either way they have a system and are successful investors.

I use Stocko to set trailing 15% soft stop loss on everything. The alerts system is powerful, you can use moving averages, relative momentum, percentage SP change, in fact almost anything to get a notification.

When I get a notification email then I have a decision to make. Sell, buy or ignore. Most of the time I sell either half or all. Very rarely I average down, but only in bull markets. So over the last few weeks I’ve been gradually selling investments. On Thursday and Friday lots of alert notifications have popped up and so I’m gradually accumulating more cash. I didn’t sell at the top but I start to preserve cash. It takes away the worry as you can be emotionally detached from the sell decision.

But it's not all bad. During covid I made a list of stocks that I really thought were good investments but just felt were too expensive before the market fell. Remember good stocks also sell off during a general market panic. With the cash from the soft stop loss sells I could start to drip feed money into new buys. I bought smaller than normal amounts in case the share price kept falling, which it inevitably did as I am always too early back into the markets!

Use this general panic as an opportunity to re-balance your portfolio into quality companies you’ve always fancied owning that are being sold off cheap. As was said 5 years ago … this too shall pass.

ken mitchell

6th Apr

The current market falls will probably continue while Trump sticks with his mad tariff policy. Markets are powerful as Truss found out, and can force policy changes. They can continue to do that by wiping $trillions more off the value of US Companies.

There are hints now of a quick Trump U-turn, including the 5 richest in America not happy at losing combined $ 41 billion so far, and Musk criticising Trump’s Europe tariffs. Markets will probably bounce just on signs of a change of policy, and a genuine relief rally if sanity returns.

Paul Walton

6th Apr

Imagine the UK negotiating a reciprocal zero tariff with the US. Anything can happen

way

6th Apr

That's my worry too. Anything can happen

The Phoenix

6th Apr

The only thing you can be pretty sure of is that when the change of direction happens its normally fast but I#m guessing further falls next week as the old boys ego won't allow him to say "I really don't know what I'm doing".

Chris Brown

7th Apr

Hi epo001. I find Trustnet to be the best place to search for funds and ETFs.

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Epo001

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