27 upvotes, 2 direct replies (showing 2)
View submission: Don't invest recklessly
The percentage rebalancing point is an interesting and wise one that isn't mentioned here very often.
We all talk about dollar cost averaging to mitigate risk and reduce stress but being conservative with enormous gains seems to me equally prudent.
Comment by quittingislegitimate at 30/11/2017 at 02:24 UTC
14 upvotes, 1 direct replies
I liked that part as well. I just sold some and am THRILLED. I didn't earn that money, and it was essentially won in a gamble.
Comment by Quartermark at 20/12/2017 at 06:31 UTC
1 upvotes, 0 direct replies
I think the rebalancing point is related to the question of your overall portfolio model. For simplicity, I have three categories of investments: 35% low risk, low volatility, low liquidity (muni bonds, treasuries), 50% in medium risk, medium volatility and highly liquid (cash, equities & real estate) and 15% in highly volatile, high risk alternatives. In this category, I try to keep at least 10 bets, each with a 90% chance of failure and a 14x+ upside if they don't fail. I re-balance every quarter. I actually play BTC in my equities portfolio (bets on the companies that could surge with BTC, either as users or producers) as well as some cloud mining and some buy-low-and-and-hold BTC purchases, all dollar-cost-averaged in and out over a quarterly window to minimize impact from the volatility. Our thesis is a $1T+ USD market cap by Dec 2017. As I said, all bets in that category are assumed to have 10% odds of a win...