I am sharing an exchange I had with a reader a few days ago because I think others could possibly be interested in it:
I really hate to disappoint you but I am not a professional financial adviser. I would suggest that you find professionals and engage their services.
However, what would I do if I were in your shoes? This is the part where I talk to myself. Please ignore me.
First, understand my motivations! I am in my 60s and retired. I am not able to suffer another market crash for more reasons than one. I am interested in a predictable flow of passive income.
Secondly, go through my portfolio of 44 stocks. Compartmentalise the investments into those that match my motivations and those which do not.
Thirdly, keep the investments which match my motivations and think about possibly increasing exposure to these investments when prices are softer. Sell those investments which do not match my motivations at an opportune time and never look back.
Fourthly, money from divestments should go into a dedicated "war chest" to buy more stocks which match my motivations during times when Mr. Market goes into manic depression.
Throughout, I have to understand that this is the general framework that I must keep in mind but being a framework, it will overlook finer details which could influence my decision to invest or to divest in specific instances.
Everyone has different circumstances and motivations. There is never a universal solution to all problems. If we understand our motivations, we will know what is most appropriate for us.
1. A letter from a 66 year old retiree.
2. A letter from a reader in his early 20s.
3. A letter from a 24 year old fresh grad.
4. Voices, noises and choices.