Should I withdraw my investments?

[Christopherrr]

Well not mine really, but my Dad's. He has Index 500 Investment account with Vanguard...and well, seeing the market now and days...he wants to know what I think about withdrawing his funds.

After the collapse of CitiGroup today and the Dow down 200+ points...he's a little worried of the outcome in next several months.

Anywho, he wanted to know what I think...

A part of me say keep it in and don't panic about a "recession"...

Another part says pull out...but that is cowardly to me and shows no faith. Which could just be blind pride...but whatever.

So, here I am...I know there's vast knowledge in this forum. What are your thoughts...

My Dad has a little over 47K invested...that keeps declining.

[Joe 1320]

There are several things to consider. As the market fluctuates, yes the total value fluctuates. The closer to retirement you get, the more you''ll want to shift the mix to something less aggressive and prone to fluctuation. If there is plenty of time before retirement, the market will rebound and the losses will be recovered. Also, when the market is down, whatever funds get invested technically buy more shares due to the lower price so the potential for a greater return increases. The main thing to consider is how long before the funds are needed?

One thing that I do subscribe to is I try to shift my portfolio's risk level every presidential election year. Statistics show that those events coincide with a drop in the market. timing is of the essence, and the exact time to shift things is a gamble. Speculation can make or break you.

[Gary94Formula]

Joe's correct...

Most people loose a moderate amount and then sell when the market is low and then attempt to get back in after it's going back up. Trying to time the market is rough and re-balancing to lessen your exposure should be the approach. Again how long does he have before he needs the funds?

I don't want to think about how bad my portfolio is fluctuating, and I'm still buying every month. I'm betting on the dollar cost averaging to work out in the end.

The election year is not helping the uncertainty in the market. That will keep on going until the election and then you'd expect the market to settle down a little once you know who's been elected.