I’ve been in the market with my retirement accounts for almost a decade now and I currently have a 0% return on them (actually down $5k). It would have been better to let them sit in an HYSA for the past decade.
My only funds are indicies and treasuries. VTSAX, VTIAX, VGSLX, and VUSTX specifically.
Am I doing something wrong here? I know the saying “time in the market is better than timing the market” but it’s still disheartening to see a 0% return after a decade of investing huge amounts of personal income in hopes of having a solid retirement fund.
Do you think it’s worth cutting losses in VGSLX and reinvesting in VTSAX? I guess it depends on how much prolonged high interest rates are going to continue to weigh on the real estate sector.
I think it depends on what you want your investment philosophy to be going forward. So you would want to answer why did you initially choose to be overweight in REITs? Do you still agree with whatever that reason is?
Another thing to consider, if you had $xxx in cash today (where xxx is what your current value is in VGSLX) would you buy VGSLX with that cash? Or would you choose to buy VTSAX instead? If the latter, then yes it would be worth cutting your losses.
It has honestly been a while since I rebalanced anything so I’m due for that, but I believe my thinking pre-covid was that I didn’t see many avenues where real estate would not continue to increase (you can’t make more land after all and it’s so damn difficult to build anything new in the US). Of course, no one was expecting a global pandemic.
That’s a good question though, I think the same underlying problems with lack of real estate exists over the long term so buying it now when the market is down seems like buying the dip, but interest rates are the wildcard here. If the fed wants to force high mortgage rates to slow down the market then it becomes “don’t fight the fed” and all that.