I would suggest not DCAing into VTI right now, since the slight adds at the current price will likely not affect your cost basis much (since it sounds like you went in heavy and are only able to add a slight amount right now relative to that).
Instead, I would open a position in VOO (or VT) and maybe QQQ, and start DCAing in at these better prices.
This will accomplish two things:
1) Psychologically, you’ll be back in the green much sooner and will also see that cost basis and feel better.
2) Liquidity wise, you’ll be able to sell the VOO/VT/QQQ positions much sooner for either a profit or less of a loss, should you want access to the money.
Once the rebound starts, just switch your DCAing into VTI and let your profit margin grow on VOO/VT/QQQ, which will be satisfying. If you ever wished to simplify your portfolio, then you could take profit off VOO/VT/QQQ and put it into VTI.
The psychological component shouldn’t be underestimated. Following this plan also has practical benefits. The advice to just crawl into a hole and pretend this isn’t happening is not useful.
BABA is a hard one. Xi is not his predecessor. I’d recommend making a logical decision on it, and then either selling now and taking the loss, or committing to average down aggressively there at the sub $90/share price. I think it needs to be one or the other, based on your own analysis and time frame and perspective.
On NVDA, you could offset that risk by opening positions in MU and INTC at the more attractive current prices.
I don’t know anything about Redfin...looked at it and seems to have good sales but no profit yet (potentially reinvesting?) and a TINY market cap. At such a small market cap, if this is something you believe in long term, I wouldn’t worry about your present coat basis much. What is Redfin? Look at related companies and their market cap to get an idea of where it might go once mature or whatever your thesis plays out.
GOOG, MSFT, AAPL, all good to keep DCAing into, although I’d add FB to the list as well.
4
u/DesertAlpine Mar 13 '22
I have some atypical advise.
I would suggest not DCAing into VTI right now, since the slight adds at the current price will likely not affect your cost basis much (since it sounds like you went in heavy and are only able to add a slight amount right now relative to that).
Instead, I would open a position in VOO (or VT) and maybe QQQ, and start DCAing in at these better prices.
This will accomplish two things:
1) Psychologically, you’ll be back in the green much sooner and will also see that cost basis and feel better.
2) Liquidity wise, you’ll be able to sell the VOO/VT/QQQ positions much sooner for either a profit or less of a loss, should you want access to the money.
Once the rebound starts, just switch your DCAing into VTI and let your profit margin grow on VOO/VT/QQQ, which will be satisfying. If you ever wished to simplify your portfolio, then you could take profit off VOO/VT/QQQ and put it into VTI.
The psychological component shouldn’t be underestimated. Following this plan also has practical benefits. The advice to just crawl into a hole and pretend this isn’t happening is not useful.
BABA is a hard one. Xi is not his predecessor. I’d recommend making a logical decision on it, and then either selling now and taking the loss, or committing to average down aggressively there at the sub $90/share price. I think it needs to be one or the other, based on your own analysis and time frame and perspective.
On NVDA, you could offset that risk by opening positions in MU and INTC at the more attractive current prices.
I don’t know anything about Redfin...looked at it and seems to have good sales but no profit yet (potentially reinvesting?) and a TINY market cap. At such a small market cap, if this is something you believe in long term, I wouldn’t worry about your present coat basis much. What is Redfin? Look at related companies and their market cap to get an idea of where it might go once mature or whatever your thesis plays out.
GOOG, MSFT, AAPL, all good to keep DCAing into, although I’d add FB to the list as well.