So my update. Not sure if I am contradicting my “don’t try to time the market” mantra, but I am more and more of the sense that being fairly all in on the S&P500 is being greedy and in these times riskier than I am comfortable with.
I’m staying in the same allocation of equities but pulled the trigger on moving out of most in the S&P index as my allocation, followed by a mid cap growth fund, and a smaller selection of individual stock picks pulling up the rear. Now I’m in VEIRX (Vanguard Equity Growth Administration Fund) in equal shares with the two other fund choices. It gets classified as large cap value. Compared to the S&P500 index VEIRX total return (dividends reinvested) was 10 year avg 10.73 compared to 13%. But less volatility. When the S&P500 dropped 18% in ‘22 VEIRX was flat, albeit in ‘18 it dropped 5.6 while the S&P500 only dropped 4.4%.
I just feel less anxious not having so much in a basket dominated by a relative handful of giant growth stocks. It begins to feel like a bubble with someone swinging and throwing a bunch of pointy sticks all around.
I also trimmed some off of an individual stock that has done very well (Trane) to buy some Pfizer as a long term play. Unfortunately I am very confident that another pandemic will happen sometime and that our current approach of destroying the public health systems both domestically and in terms of international cooperation are likely going to make it very bad when that happens. Whenever it is. Pfizer stock price is very low now, its dividend high and likely relatively safe from major cuts, and when there is a next health crisis it will be a good hedge to have. May that never happen and all I get is the dividend as return.