What I am thinking about investing in this bear market?

Hi everyone!

Gosh, what a year 2020 is. I wish I could flip the calendar and start 2021 right now. The health, emotional and financial stress this one single disease causing is unimaginable. I hope whoever is reading this post is healthy and your loved ones are take care of. I did not get chance to sit down and write a post in last couple of months with some issues at work and working a DIY project on our kitchen and backyard.

I am sure many folks in FIRE journey may be evaluating the whole FIRE concept critically. My personal portfolio dropped about 30% at the worst on Mid March but since recovered about 15% of the loss. So I can feel the needle pinch pain there! I was reading few other FIRE blogs and seems like lot of folks really questioning how people who are already in retirement phase (RE) are coping with the loss of portfolio and hence reduced income? My personal thought is that it should not be a big deal, as part of FIRE we are supposed to have at least 6-8 month of expense in high interest saving account or in treasury note. Also, another aspect that is calming is in grand scale of S&P 500 time line, this drop does not look too terrible. So, if someone hold tight and don't sell out of panic, thing will look better again.

Personally, I guess the recovery from this pandemic will not be a V shaped one. One thing to note that this pandemic is created by this virus, so until and unless, there is some sort of vaccine or treatment is there, economy will not bounce back over night. One positive side is that now we have some clearer idea on how this disease spread and what precautions we can take to minimize the spread. This will help us to minimize the damage while increasing economic activities in coming months.

Now the question among all of us is should we keep investing or wait till this pandemic is over.

My personal take is that I should always investment in quality equities regardless what market is doing. I don’t have large chunk of money sitting aside to scoop up when price is lowest, so dollar cost averaging was and is always my strategy. In the beginning of market drop I invested few hundreds on falling cruise and airline stocks thinking this downfall was going to be brief:( Things did not turn out that way for those two sectors and I am quite down on those stocks. I hope one day they will recover and the high dividends will be worth the short pain. the worst thing would some of them declare bankruptcy. I am ok with waiting few years for price recovery but boys just don’t go bankrupt😀

Now as it seems bit sure that this uncertainty is going to be there for a while, I am focusing on more sectors that so far did well and there is demand even people are stuck at home. Currently my short list includes information technology, consumer staple and Utility sector companies. Last month I added following holding on my portfolio. I hope they will perform less volatile in this period and grow steadily in the long run. 

That’s all for today. Stay safe!

Disclaimer: This article shows my personal opinion and its for entertainment purpose only. This is no way professional financial advice. You may seek professional advice or conduct own research before investing.