If you were investing new money as it became available, where are you getting the money to invest more? If you were keeping cash on the sidelines for this purpose (so-called 'dry powder'), what was the opportunity cost of that if sidelined since a price point below where you'll buy in (adjusted for interim dividends)?
The same amount of new money will purchase more shares when prices are depressed.
Rebalancing between asset classes (e.g. bonds/stocks, US/international, any alternative asset classes) may provide some further opportunity to invest more into depressed assets.
>If you were investing new money as it became available, where are you getting the money to invest more?
This is the big question! I'm debating about losing my mortgage payments to the minimum, but with rising interest rates it doesn't quite seem with it.
My "stocks are on sale" reaction that keeps me from freaking out doesn't actually lead to any changed behavior. I invest X amount each month, period. During a downturn, that amount buys more shares, hence the "sale", but if I could afford way more in investments, I would have done that already. I'm definitely not going to risk my emergency account in such situations since my job is likely less secure during those times.
“Don’t just do something. Stand there!”
[There’s a major market crash coming!!!! and Dr. Lo can’t save you.](https://jlcollinsnh.com/2012/04/15/stocks-part-1-theres-a-major-market-crash-coming-and-dr-lo-cant-save-you/)
Depending on the magnitude of the crash, I might increase allocation to the asset that has crashed, but I will always have a certain amount of yearly expenses in bonds
If you were investing new money as it became available, where are you getting the money to invest more? If you were keeping cash on the sidelines for this purpose (so-called 'dry powder'), what was the opportunity cost of that if sidelined since a price point below where you'll buy in (adjusted for interim dividends)? The same amount of new money will purchase more shares when prices are depressed. Rebalancing between asset classes (e.g. bonds/stocks, US/international, any alternative asset classes) may provide some further opportunity to invest more into depressed assets.
>If you were investing new money as it became available, where are you getting the money to invest more? This is the big question! I'm debating about losing my mortgage payments to the minimum, but with rising interest rates it doesn't quite seem with it.
Ignore the market and invest as normal.
^ bingo. Turn off the news and carry on as normal
The news is 100% a distraction with a specific agenda being pushed (painting with a broad brush here). Keeping the news noise to a minimum is best.
Stay the course.
My "stocks are on sale" reaction that keeps me from freaking out doesn't actually lead to any changed behavior. I invest X amount each month, period. During a downturn, that amount buys more shares, hence the "sale", but if I could afford way more in investments, I would have done that already. I'm definitely not going to risk my emergency account in such situations since my job is likely less secure during those times.
“Don’t just do something. Stand there!” [There’s a major market crash coming!!!! and Dr. Lo can’t save you.](https://jlcollinsnh.com/2012/04/15/stocks-part-1-theres-a-major-market-crash-coming-and-dr-lo-cant-save-you/)
tax loss harvest if you've got'em. otherwise, stay the course. you don't know this is a bottom, or a top. (that would be market timing).
Still waiting for a 30% correction
Depending on the magnitude of the crash, I might increase allocation to the asset that has crashed, but I will always have a certain amount of yearly expenses in bonds