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PaperclipPerfector  3d ago (text post)   1727 thread views

Small-Scale Question Sunday for May 4, 2025

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I'm considering selling a bunch of stock tomorrow. The tariffs appear to be real and not going away super soon. Tensions tend to build and reach a fever pitch in the summer and judging by the Karmelo Anthony/Shiloh Hendrix stuff and Trump in the White House I'm expecting this summer to be a mess. My intuition is telling me things are only going down from here. Markets in Asia have already opened way down for Monday. Sell in May sounds like a great idea.

Will definitely dump my share of Amazon. Apple got an exemption from tariffs and I'm sure they make enough of their revenue from non-hardware that I'm thinking of staying with Apple and the rest of the tech companies. Kind of tempted to just dump everything else honestly because I have such a sour outlook on the economy in the short term but I'm also up so much that I don't want to pay a ton in taxes. I might hedge my bets and sell half or less of whatever I'm worried about and then try and buy once markets have crashed. I planned to keep 10% of my portfolio in cash (earning interest) but my 10% has shrunk as the rest of the portfolio has grown around it so I could always use a bit more cash.

I guess my small-scale question is how bad of an idea would it be to liquidate everything I own tomorrow?

I would copy the cash to investment ratio of Buffet. So not a full retreat but liquidate some.

It depends on so much... How much do you know about the market, valuation etc.? What's your investment horizon? What's your ratio between net worth : monthly savings amount : monthly spending amount? What type of accounts are these held in (e.g. how much of a tax hit will you take selling?) Do you plan to stay in the US indefinitely? What would you do with the money instead? (Bonds are trash, although e.g. dollar denominated Turkish corporate debt is quite interesting right now. USD will be inflated away, which hard assets protect against - but US equities are not generally such hard assets, primarily valued for good will and imputed future growth. Vice stocks (BTI) and certain small industrial companies (PPSX, HNRG) are nice. I'm a long term commodities bull, but the macro's complex and Trump's policies might as well be designed to destroy the energy industry so I can't recommend favorites like (VALE, PBR.A).

I've personally been almost 100% in the other widow maker (junior gold miners) for about a year and a half, since the regional banks rerated. There's still a long room to go (with many companies' earnings equal to their market caps) as gold's doubled while most are much cheaper than in 2021 - but the margin of safety's declined. More importantly, you can't hold a commodity producer for a long time, requiring future selling - which would require you to understand them well enough to correctly exit. That adds tax complexities, depending on account type etc.

You should probably not do anything. Funnily, APL is the one I would most strongly suggest you exit.

I think it’s a terrible idea. But if you’re going to do it you should have a very specific number at which you acknowledge you were right and buy back in for cheaper (or else you’ll watch the recovery while waiting for more down movement until prices are above what you sold them for).

Then come up with a number at which you will admit you were wrong and buy back in (or else watch it run away and pray for a pullback that may never come.)

Personally I don’t think we’ll see S&P 500 below 5300 ever again. Wall Street really didn’t want it below 5500 and it took something massive like liberation day to break past it in the first place.

The temperature has gone way down on wall street since the pause, and we found Trump’s pain tolerance limit. And China cannot wait us out—our economy is just better.

Pretty good idea, I have a lot in cash and defensive stocks atm myself. This paper argues that you should only invest at ATH and bail when the going gets tough.

Don’t liquidate everything. Cigarette stocks, at the minimum, do well in a recession.

I'm thinking about trimming my equity exposure as well. I can't in good concience reccomend liquidating everything. Can you imagine missing the "AGI has been achieved internally (but for real this time)" rally?

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