Losses

Since December, one of my IRAs has lost about 1/7 of its value. The stock market has declined. The S&P dipped below 11,000 yesterday.

Since the first of the year the Dow Jones is down 20%. It was down 9.4% in June which was the worst month since the 1930s.

Have I lost 14% in this one account? Not really. The value has declined by that much but I have not had a loss.

It is what accountants and financial people call an unrealized loss or book loss. I have not "cashed out" and accepted less $ for my investment. Should I cash out of this holding?

With an IRA I have a long term approach. I will need the $ in retirement and will be forced to begin taking distributions when I am 70 1/2 years old in 2021. So for now I will let it ride and hope for a recovery.

Since I have lost 14% in value, this IRA needs to gain value equal to 17.6% to return to January 1 value.

The Dow, which is down 20%, needs to gain 25% to return to January 1 values.

I have not realized my loss yet.

'til later