Welcome to European Tribune. It's gone a bit quiet around here these days, but it's still going.
Display:
I have a retirement nest egg invested in a variety of sectors in mostly Irish and UK shares in companies I regard as being generally well managed.  I rarely trade as the objective is to preserve long term value for my children and grandchildren - the first of which is due this July.  My view is that my children and grandchildren are unlikely to be able to live as well, financially, as I can now, and therefor the least I can do is facilitate some inter-generational transfers.

Occasionally if a house deposit, educational fees, or a car is needed, I might sell some to fund same.  Anything to avoid my children having to pay rip-off interest on much needed goods and services. Overall the strategy has worked very well, the Irish stock market crash of 2008 (-40%) having been largely recovered in 2009. I did hedge against a Euro break-up, but that investment has turned out to be largely earnings neutral in any case. In general I found my own instincts to be at least as good as stockbroker advice.

What I have noticed, however, is an increasing volatility in the market as Irish stocks, in particular, are bounced around by international investor sentiment towards "emerging" markets.  There seem to be huge volumes of cash sluicing around the international financial system looking for returns in ways no fundamentals could ever justify. Investing directly in shares is not for the faint hearted, but I prefer it to paying huge commissions to the "financial industry" for negligible returns especially when compared to the risks.

Being very much a long-term investor, I can afford to take a sanguine view of short-term developments. I foresaw the 2008 crash (thanks in part to you folks here), but not quite it's short term severity. I also foresaw the recovery, perhaps ahead of some here, but am unsure of how sustainable it is. So at the moment I am agnostic about future directions, and am open to being educated. I am more exposed to some shares (that have done particularly well) than I would like, but cannot think of any place better to put the money at the moment. I like to be as counter-cyclical and counter-prevailing wisdom as possible, but also have no reason to be greedy. The objective is inter-generational solidarity, not empire building.

None of this sits particularly well with me from an ideological point of view, but in the absence of good public pensions and healthcare provision for the retired (and the young) I can see no pragmatic alternative. My primary responsibility is to my children's families; I can't take the world's problems on my shoulders.

That said, I support progressive state policies where they harm my self interest, and am continually amazed at how little my generation and those better off are asked to contribute.  This last recession has primarily been an attack on the young and on future generations at the behest of the old and wealthy - those with least to contribute into the future - and who are mistakenly seen as the wealth creators rather than the rentiers they truly are.

Age and treachery will always triumph over youth and enthusiasm. plus ça change etc.

Index of Frank's Diaries

by Frank Schnittger (mail Frankschnittger at hot male dotty communists) on Mon May 19th, 2014 at 01:20:55 PM EST
PS - The Irish Stock Exchange (ISEQ) general index reached a peak of 10,000 points briefly in April 2007 and fell to 1,987 points, a 14-year low, by 24 February 2009 - it was my total portfolio which crashed 40% between calendar years 2008 and 2009

Index of Frank's Diaries
by Frank Schnittger (mail Frankschnittger at hot male dotty communists) on Mon May 19th, 2014 at 01:25:11 PM EST
[ Parent ]
correction - between 2007 and 2008

Index of Frank's Diaries
by Frank Schnittger (mail Frankschnittger at hot male dotty communists) on Mon May 19th, 2014 at 01:30:24 PM EST
[ Parent ]
I am more exposed to some shares (that have done particularly well) than I would like, but cannot think of any place better to put the money at the moment.

Simply cashing out of stocks one feels over-exposed to and sitting on the cash (until one is more confident in the long-term sustainability of share prices) is a valid option that most people tend to forget exists.

(Usual disclaimer: This is not investment advice, and frankly if you're taking investment advice from some dude on the Internet then you're asking to get ripped off.)

- Jake

Friends come and go. Enemies accumulate.

by JakeS (JangoSierra 'at' gmail 'dot' com) on Mon May 19th, 2014 at 03:06:07 PM EST
[ Parent ]
You're NOT some dude on the internet... and yes, cashing out is an option I have, on rare occasions, exercised. If I thought we were on the cusp of a bubble now, I would do so, but that is not where I think we currently are. More likely, prolonged stagnation, low growth, periodic "corrections", occasional panics, and hard to fathom or predict rallies.  All dependent on the capricious actions of mega investment funds, not necessarily economic or business fundamentals.

Index of Frank's Diaries
by Frank Schnittger (mail Frankschnittger at hot male dotty communists) on Mon May 19th, 2014 at 05:06:56 PM EST
[ Parent ]
Doesn't have to be all-or-nothing. If you bought 100 each of A, B and C at 100, and A is now 110, B is 120 and C is 150, and you think C is overvalued by 30, then you can sell 20 C and keep the 3,000 cash, if you are not confident that A and B are not overvalued (but also are not confident enough that they are overvalued to want to cash out completely).

Anyway, usual disclaimer about not giving investment advice, etc.

Personally, I'm all-cash right now, but that's because I have basically no wealth and expect to need the liquidity soon.

- Jake

Friends come and go. Enemies accumulate.

by JakeS (JangoSierra 'at' gmail 'dot' com) on Mon May 19th, 2014 at 05:34:05 PM EST
[ Parent ]

Display:

Top Diaries

Occasional Series