Should You Sell in May Before You Go Away on Vacation Stocks are almost back as high as they were on February 19, 2025. The S&P500 was down -8.8% as of May 6, 2025. So, should you sell in May before you go away on holiday? And by that I mean, rebalance and make sure that you have an age-appropriate, properly diversified plan that is overweighted a little safe (in case of more weakness). Additionally, if you’re suffering from paper losses, is there a better strategy? Below the topics we will cover in this blog. Spring Rally September Back to School Stock Sales Expensive Stock Prices Tariffs Chance of a Recession Whales and Hedge Funds Paper Losses And here is more information on each one. Spring Rally While we did have a little recovery from the rout earlier in April when the market flirted with the Bear (-19% on April 8, 2025), the Spring Rally really didn’t measure up this year. Typically, March and April are two of the most reliable performing months of the year. However, with stocks still trading near their all-time high, now is a great time to rebalance our wealth plan. September Back to School Stock Sales When we rebalance our wealth plan at the end of April/early May we are often capturing gains at the high. This also gives us more liquidity. If the summer is weak, and September is true to form (the worst performing month of the year historically), then we are in a position to buy more at a lower price at the end of September. Rebalancing 1-3 times a year is a very good idea. This is not day trading. It’s simply ensuring that we are observing Modern Portfolio Theory, which is a time-proven, 21st-century plan. Our pie charts make MPT as easy as a pie chart. Every seasoned broker-salesman knows the term: Modern Portfolio Theory. However, I do a lot of unbiased 2nd opinions, and I have yet to find one that was truly age-appropriate and properly diversified. Even more alarmingly, in today’s world I’m seeing a great deal of paper losses in conservative portfolios, and for people who are close to retirement. Keeping our money safe, and having it intact and available is always important, but even more so as we get closer to a time when we are no longer receiving earned income. Expensive Stock Prices One of the reasons why it’s a very good idea to do our rebalancing now is that stocks are historically expensive. Most of us have heard the term “buy low, sell high.” (In our nest egg, it’s a better idea to think of it as adding low and trimming high, so that we keep the proper amount safe and diversified.) Elevated equity prices are highly correlated with swift and startling declines. In the words used in the Financial Stability Report that was released on April 25, 2025, “Elevated valuation pressures may increase the possibility of outsized drops in asset prices… equity prices remained high.” Tariffs Tariffs are still a moving target. However, in general, they tend to increase inflation and slow down economies. The U.S. economy contracted -0.3% in the 1st quarter and is expected to slow down to 1.7% GDP growth in 2025, from 2.8% in 2024. The trade war will be hard on a lot of different industries and companies but does have a few positive spots. We have seen the Chinese companies Temu and Shein suspend deliveries in the United States, which is helpful for the beleaguered U.S. fashion and retail industries and may help to reduce fast fashion waste. (As the co-creator of the Earth Gratitude project and the author of The Power of 8 Billion: It’s Up to Us, I’m hopeful that this pause will allow the word to get out about the many harmful side effects of polyester, which is an oil product. Up to 80% or more of the clothes churned out by fast fashion companies can be composed of oil-based fabrics.) The automotive industry is one that could be adversely affected. In their 1Q 2025 financial results, Ford suspended their forward guidance and warned that they could have a “tariff-related net adverse adjusted EBIT impact of about $1.5 billion for full year 2025.” Since Ford Motor Company has teetered between BBB- (investment grade) and junk status over the past decade, tariffs could have a negative impact on Ford’s credit rating. Tesla is in a slightly better position for a variety of reasons, including: 1) having the top selling sedan in the world, 2) being one of the top selling EV brands in the world, and, 3) manufacturing cars in the region that it sells. However, Tesla (and Ford and GM) are being challenged by lower-priced Chinese EV manufacturers, which is why on both sales and profits. You can learn more about this in my Tesla blog. Chance of a Recession? JP Morgan has put the risk of a recession in the US in 2025 at 60%. Of course, that also means there is a 40% chance that we skate by without one. This is another argument for making sure that we know exactly what we own and why now and understand how to protect our wealth from another downturn in stock prices. It’s important to remember that 21st-century recessions have historically cost a lot of investors more than half of their wealth and then take years to crawl back to even. It took the NASDAQ Composite Index 15 years to return to its March 2000 high after the Dot Com Recession, which handed -78% losses to Dot Com investors. (A million dollars became $220,000.) During the Great Recession, 20 million homes were foreclosed on and the Dow Jones Industrial Average Index dropped by -55%, taking almost six years to recover. Whales and Hedge Funds On April 8, 2025, when stocks plunged by -19% from their Feb. 19, 2025, highs, the selling was coming from the whales of Wall Street. That is the way it typically goes. The big players on Wall Street take profits at the top. Main Street is placated with consoling words that it is really not as bad as everyone thinks. By the time when we think it’s an Apocalypse, we’re closer to the bottom, which is when many Main Street investors are tempted to sell. In fact, if you look more closely at the charts above, recessions are not typically declared until Main Street has lost 40% or more of their wealth. In most cases, they won’t be officially declared until at least seven months in. This is another reason why we want to rebalance regularly rather than sit on our hands. In my most recent Money Show presentation, one of the participants asked me if Main Street investors would just get used to the volatility. The problem with that premise is that losing money isn’t a mental exercise. It can plunge us into a real-world crisis. Most of us really can’t afford to lose any of our wealth much less half of it. Our FICO score plunges. Our ability to solve basic financial problems, such as paying our mortgage or rent, becomes problematic. And when fear rules the day, we’re tempted to sell low to stop more losses and sleep at night. Proper diversification with regularly balancing is a “capture gains” mindset. The reason most people cannot buy low and sell high is this it’s contrary to human nature, until we train our emotions to be in service to a better plan. Additionally, most people don’t buy low because they can’t. When you lose half or more in a recession, you’re struggling to stay afloat and to keep your home. You just have the resources to take advantage of the opportunities that arise when prices drop. Paper Losses In a normal recession, bonds can be buoyant. It is one of the ways that Milo Bolden earned gains in the Great Recession, when most people around her lost half or more of their wealth and took years (or a decade) to get out of the hole. However, these days there is too much leverage, debt, low credit quality and duration risk for a cut in interest rates to solve everything. In 2022, long-term government bond values dropped -26%, resulting in the failure of five banks in early 2023. If you are suffering from paper losses, your conservative plan could be a lot riskier than you realize. Learn more in the blogs below. Should I Have a Managed Portfolio Paper Losses Bottom Line It’s human nature to wait until things are broken to fix them. However, it’s a far better plan to fix the roof while the sun is shining than to wait for the storm to cause a flood. “Sell in May before you go away” is a popular Wall Street aphorism for a reason. Wall Street goes dark in August, as burned-out financial executives flee Manhattan and the Beltway. Bad news is often buried over the summer. That is one of the reasons why September tends to be the worst performing month. The investor who has captured gains, locked in their profits and increased liquidity is in a position to buy low if prices weaken over the summer and in September. In 2025, sell in May before you go away on vacation is likely to be a good idea. I’m not suggesting promoting market timing. Rather, make sure that we are: · Keeping a percentage equal to our age safe, · Diversifying the at-risk portion of our nest egg, · Overweighting an additional 10-20% safe, due to heightened leverage, expensive prices, lower liquidity and the increased risk of a recession. I’m hosting a Financial Freedom Retreat online June 6-8, 2025, where you can learn and implement this strategy. Email [email protected] to learn more now. Join us at our online Financial Freedom Retreat June 6-8 2025 where you'll learn how to protect your wealth, save thousands annually in your budget and how to green your money. The following Saturday on June 14, 2025, at our Real Estate Master Class. you'll discover the 10-point checklist for home buyers and sellers, as well as some overlooked areas of opportunity. If you'd like a life-changing adventure of a lifetime, be our guest at a royal manor house in Cornwall, England, March 12-19, 2027. (With just eight rooms available, this exclusive, private, bucket-list adventure sells out a year in advance!) Call 310-430-2397 or email [email protected] to learn more. The 2025 Restormel Retreat was a magical and royal experience. Click to learn more. Your friends and family can get the best price for the Financial Freedom Retreat June 6-8 2025 when they register by May 15, 2025. Request testimonials at [email protected]. You can also view some on the flyer page of the retreat. Learn how to: * Invest in hot industries, such as Nvidia, artificial intelligence, and quantum computing, * Hedge against a weaker dollar, * Invest and compound your gains, * Green your retirement plan, * Easy and efficacious nest egg strategies, * Get hot and diversified (including in artificial intelligence, quantum computing and crypto), * Evaluate stocks, * Avoid capital gains and financial predators, * Keep an age-appropriate amount safe, and, * Know what's safe in a Debt World. You'll even discover how to save thousands annually with smarter big-ticket choices. Yes, it's a complete money makeover. Email [email protected] or call 310-430-2397 to learn more and register. Learn the 15+ things you'll master and read testimonials in the flyer on the home page at NataliePace.com. Register with friends and family to receive the best price. "Ten minutes into the first day I was already much smarter about investing than I ever thought I would be in my life and I knew I was in exactly the right place at this retreat. I am amazed at how EASY and FUN it is to make my money work for me and those I love. I think this kind of information should be compulsory in schools. I wish I'd learned this sooner." CM If you’d like an unbiased 2nd opinion on your current wealth plan, email [email protected] for pricing and information. ![]() Visit NataliePace.com to learn more. Call 310-430-2397 or email [email protected] for pricing, additional information and to register. Early Bird pricing ends May 15, 2025. ![]() Join us for our Restormel Royal Immersive Adventure Retreat. March 2027. Email [email protected] to learn more. Click for testimonials, pricing, hours & details. Register now to receive the best price, the best room and eight private, prosperity coaching sessions. There are only 8 rooms available. This retreat includes an all-access pass to all of our online training for a full year for two. Considering the perks, you're receiving a 70% discount to learn the life math that we all should have received in high school, and the room is free! Email [email protected] to learn more. The best rooms at the 2025 retreat were sold out in 2024! Yes, it's a great idea to register and start transforming our lives now! ![]() Natalie Wynne Pace is an Advocate for Sustainability, Financial Literacy & Women's Empowerment. Natalie is the bestselling author of The ABCs of Money (6th edition) and The Power of 8 Billion: It's Up to Us, and is the co-creator of the Earth Gratitude Project. She has been ranked as a No. 1 stock picker, above over 835 A-list pundits, by an independent tracking agency (TipsTraders). Her book The ABCs of Money remained at or near the #1 Investing Basics e-book on Amazon for over 3 years (in its vertical), with over 120,000 downloads and a mean 5-star ranking. The 6th edition of The ABCs of Money and the 2nd edition of Put Your Money Where Your Heart Is (2nd edition) are the most recent releases of these books. Follow her on Instagram. Natalie Pace's easy as a pie chart nest egg strategies earned gains in the last two recessions and have outperformed the bull markets in between. That is why her Investor Educational Retreats, books and private coaching are enthusiastically recommended by Nobel Prize winning economist Gary S. Becker, TD AMERITRADE chairman Joe Moglia, Kay Koplovitz and many Main Street investors who have transformed their lives using her Thrive Budget and investing strategies. Click to view a video testimonial from Nilo Bolden. Check out Natalie Pace's Substack podcast on Apple and Spotify. Watch videoconferences and webinars on Youtube. Other Blogs of Interest Tesla, Tariffs, Chinese Competition and Price Wars. Fun Ways to Celebrate Earth Day April 22nd. Will the Correction Become a Bear Market? 21st Century Recessions Look More Like Depressions. Will Oil Prices Sink or Soar? Executives are Uncertain. Health Savings Accounts. Save Thousands. Get a Tax Credit. Provide for Tomorrow's Healthcare Needs. Restormel Manor House 2025. A Truly Royal and Magical Adventure. 9 Ways to Cut Your Tax Bill in Half and Save Thousands Annually. Berkshire Hathaway. Should I Just Invest in Warren Buffett? Should I Have a Money Manager? The Cleanest Cities in the World. Can Altadena, Pacific Palisades and Gaza Become Edens? Rebuilding Gaza. American Companies Will Benefit. Top Dividend/Income Strategies for 2025. 2025 Crystal Ball: Who Will be the Superstars of Wall Street? Gold & Crypto IRAs and the Risk of Fraud and Losses. 10 Rules of Successful Investing. Quantum Computing. Paper Losses. Another Warning About Long-Term Bonds! 2025 Investor IQ Test. 2025 Investor IQ Test Answers. Apple iPhone Sales Plunge in China. Indonesia: Rich in Nickel with Ambitions of Becoming an EV Battery Hub. RoboTaxis. AI. The Magnificent 7. Charitable Giving. Nonprofits that are Worthy of Supporting. Why Are So Many Safe Investments Losing Money? A Bargain-Priced AI Company. Canadian, Australian and U.S. Banks. Are Any of Them Safe? Ireland. Rich in Technology, Biotechnology and Agribusiness. Robo Investing and AI. No, They are Not Foolproof. Stocks Soar as Nvidia Joins the DJIA. Copper. Peru ETF Outperforms the S&P500. Will Insurance Companies & Homeowners Weather the Hurricanes? 9 Money Secrets of the Ultra Wealthy. Housing & Budgeting Solutions. Arkansas Sues Temu for Data Theft. We Must Be the Boss of Our Money. Why? Fast Fashion. Fossil Fuels. Plastic Clothing. Atacama Desert Waste Dumps. Can Crowdstrike Recover from its Colossal Catastrophe? Featuring a Cybersecurity Overview. Fintechs and Brokerages that Fail are Not FDIC-Insured. 5 Green Tips for Clean Beaches Week. So, You Think You Want to Be a B&B Owner... Retiring Soon? Start Planning Now. 2024 Rebalancing IQ Test. Answers to the 2024 Rebalancing IQ Test. 9 Inflation, Budgeting, Debt Reduction and Investing Solutions. China & Russia Double Their Gold Holdings. 2024 Investment of the Year? Bitcoin Sets a New Record High. The Importance of Rebalancing. Uh. Oh. More Bank Trouble. Housing. Unaffordable. What Works? Case studies and creative solutions. The Underperforming DJIA, Full of Fossil Fuels and Forever Chemicals. The Best ROI* (Almost 40%!) & 7 Life Hacks That Save Thousands. 13 Lifestyle Choices to Reduce Waste, Pollution & CO2 & Save a Boatload of Dough. China Bans Apple 11-Point Green Checklist for Schools. 10 Wealth Secrets of Billionaires and Royals. Bank of America has $100 Billion in Bond Losses (on Paper) Fiat. Crypto. Gold. BRICS. Real Estate. Alternative Investments. BRICS Currency. Will the Dollar Become Extinct? Why We Are Underweighting Banks and the Financial Industry. Save Thousands Annually With Smarter Energy Choices Is Your FDIC-Insured Cash Really Safe? Money Market Funds, FDIC, SIPC: Are Any of Them Safe? My 24-Year-Old is Itching to Buy a Condo. Should I Help Him? The Bank Bail-in Plan on Your Dime. Important Disclaimers Please note: Natalie Pace does not act or operate like a broker. She reports on financial news, and is one of the most trusted sources of financial literacy, education and forensic analysis in the world. Natalie Pace educates and informs individual investors to give investors a competitive edge in their personal decision-making. Any publicly-traded companies, funds or projects mentioned by Natalie Pace are not intended to be buy or sell recommendations. ALWAYS do your research and consult an experienced, reputable financial professional before buying or selling any security, and consider your long-term goals and strategies. Investors should NOT be all in on any asset class or individual stocks. Your retirement plan should reflect an age-appropriate, diversified wealth plan, which has been designed strategically, with the assistance of financial professionals who are familiar with your goals, risk tolerance, tax needs and more. The "trading" portion of your portfolio should be a very small part of your investment strategy, and the amount of money you invest into individual companies should never be greater than your experience, wisdom, knowledge, patience and diversified strategy. Information has been obtained from sources believed to be reliable. However, NataliePace.com does not warrant its completeness or accuracy. Opinions constitute our judgment as of the date of this publication and are subject to change without notice. This material is not intended as an offer or solicitation for the purchase or sale of any financial instrument.
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AuthorNatalie Pace is the co-creator of the Earth Gratitude Project and the author of The Power of 8 Billion: It's Up to Us, The ABCs of Money, The ABCs of Money for College, The Gratitude Game and Put Your Money Where Your Heart Is. She is a repeat guest & speaker on national news shows and stages. She has been ranked the No. 1 stock picker, above over 830 A-list pundits, by an independent tracking agency, and has been saving homes and nest eggs since 1999. Archives
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