A little bit of reflection on 2007-2009 for those just starting into investing

I am noticing many on this sub are admitting they are brand new to investing, but are heavily advocating leveraged ETFs, 100% stock portfolios, and individual stock picks over indexes. Its true for almost the last 8ish years we have been in a bull market, if you are just starting out this bull is all you have known (Evidenced by many posts calling stock fluctuation by 1-2% a rally/crash). I wanted to link to several forum posts from another financial community that was active at the time of the 2008 financial crisis to give some of you perspective on what its really like to be in a real crash and the panic that overtakes people when they misjudge their risk.

Reddit was still competing with Digg in 2007 and not as large as it is today, so all three links are from Bogleheads:

• 2007: College student at the time taking advantage of the bull market, uses 2x leverage, loses $210K of borrowed money, and is forced is to sell what's left of his portfolio at S&P 821 in November 2008.

• 2008: During the crash couple with low income who saved millions over the decades sees all their work wiped out over night and sells to stop the bleeding

• 2009: During the last portion of the main dip of the crisis, many can not hold their risk allocations out of fear

I wonder how this sub is going to react to a real crash, and not just a 1-5% dip. Many here are really being gun ho with advice due to a super bull market in stocks, but when the party is over it can get really ugly for you if you are not willing to accept massive losses with an all stock portfolio.

Submitted March 15, 2017 at 09:40PM by species_8472 http://ift.tt/2mQDVXb