
This past Monday I decided to cash out my gold ETFs (GLD) after realizing a nice double digit gain in just 5 weeks during this market turmoil. Two days later GLD pops for another 5% in a single day. Hence, abandoning my buy-and-hold strategy of at least a portion of my investments in gold caused me to miss out on that nice little pop. Nevertheless, pigs get fat and hogs get slaughtered, so I am consoling myself with the fact that I cashed in my gold chips at the market casino while ahead. I am back to having just over 20% of my investments in cash (plus another 20% in long-term US Treasury bonds) to use for buying beaten down stock index funds. Since many individual stocks (particularly small and mid caps) appear to be well over 20% down, I will likely start putting some of that cash to work in the very near future after catching a whiff of capitulation and despair in the markets this past week.
Last edited by Danny Ocean; 02-13-2016 at 09:31 AM.

By the close of the trading day on Friday, February 26, my investment portfolio fully recovered (barely) its total market losses for 2016. My strategy during this market correction was a hybrid of buy-and-hold (with respect to equity and long-term US treasury index funds) and some amateur market timing (with respect to REIT index funds and GLD etf). In short, I avoided the temptation to sell investments that were losing value and instead only sold those investments that were increasing value during the market correction.
More importantly, I entered this unexpected market correction with a diversified portfolio of investments that were not correlated to one another: equities (large caps, mid/small caps, int'l caps, REITs), long-term US treasuries, gold, and cash. Such diversification facilitated two outcomes: 1) it prevented my investment portfolio from declining as much as the overall stock market during the market correction, and 2) it set up my portfolio to recover its losses faster than the overall stock market during the market rebound.
Last edited by Danny Ocean; 02-28-2016 at 05:12 PM.
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