I am fascinated by Eric Cinnamonds blog. I wonder if he has a future as a journalist. He is prolific as well, posting almost daily. I do struggle to come away with actionable advice from him though. I can't sit there in 100% cash. Especially when there are solid companies that could be had at decent values. I think he is looking for deep value and I can live with avoiding over valued stuff.

Back to multiple paragraphs ago: I don't think DCA into market that is (probably) overvalued is a wise strategy. I read the latest Cinnamond Absolute Investing blog, and I wish I had his millions (so I could feel good about a Starbucks latte, and walking my dog, and not buying any over-valued thing. [He's also a lot younger, so he can get back in the game when values exist.]). And he actually plans to do so. This raises the question: do I save cash; plunge heavily in to any new fund he establishes? I'm pretty sure he will
Perhaps the post suggesting that 2 initial up months guarantees a positive year is correct, but I may be up 8% now (in some accounts) and 2% at Xmas, which makes me positive, but not too happy.
People who take 1% of my money (or more) are isolated from my needs. If their funds decline 5% in a 20% decline (an extremely rare event), I have still lost money, but they trumpet a successful year.
Cinnamond says there's nothing he sees worth buying, and I'm still trying to find stuff to sell.
I'm sure there are multiple individual stocks that will do well as (relatively) desperate managers and individuals buy them, but I hope they are paying dividends.
While happy with my gains, I have to wonder if this another peak at which I should sell. I've missed or ignored all the other, so why should this be different?

Hi @Bobpa
First, hats off to you for the support and guidance for your grandaughter.
This book/link relates to all things in our lives and assuredly to the critical aspect of the psychological/emotional side of investing.
https://www.amazon.com/Power-Habit-What-Life-Business/dp/081298160X
This book/link deals with, in particular, spending habits; which directly relates to the ability to have monies to invest; as well as for "other" regarding too, wants and needs.
https://www.amazon.com/Millionaire-Next-Door-Surprising-Americas/dp/1589795474
This link is for Khan academy, to which your grandaughter likely already has access. Many investment topics are in place at this site. Although this link subject is not directly related to beginning investing.
https://www.khanacademy.org/economics-finance-domain/core-finance/investment-vehicles-tutorial/investment-consumption/v/investment-vs-consumption-1
Lastly, I suggest a search of Youtube. Many investing videos are available, including beginning and understanding through a variety of topics. I find video/graphic presentation to be a happy presentation medium to my brain for intake of the information.
Regards,
Catch

Fairholme issued a response, weirdly, it's not on their website yet, but here, on Valuewalk: http://www.valuewalk.com/2017/02/fairholme-fannie-mae-court-pr/

I've held PARMX since 2014. It is a 5 star fund from Morningstar. It has had the same management team since 2008. During that period it has had much better returns with lower volatility than the MB category that it is in. I've been pleased with it.

While it's difficult to do so at my age, I'm watching Eric Cinnamond and reading his Absolute Value blog. So I'm taking profits and trying to make myself sell my losers (much more difficult). New money from my 403b sits there glaring at my failure to ride the bubble, and I worry about my "not so old" money, which is generally positive, although some of it took overlong to become so (but my idea of "new" is within the last 5 years). I did buy some XAR, due to some suggestions here.
This is an artificial market, driven by QE, and rates have to rise sometime. Yellen will be replaced by a compliant individual, but there is an increase or two in interest rates in the meantime.
If anyone knows when to step out of this market, they're much smarter than I. One also has to be able to predict crowd behavior, to get to the exits before they do; and some members of this crowd use megadata and computer arrays far beyond my ability, time or resources.
I haven't put my grandchildren's money in since I have to believe there's at least a 10% decline to come, but 20% seems possible.
As others have commented, one needs to buy when there is blood in the gutters (but, frankly, I doubt the Rothchilds were ever fully invested).
Must admit that I'm a long way from dog food for lunch (and, hey, the French eat horsemeat, so I hear), but I bet some of that Fancy Feast with a bit of onion and hot sauce would be mighty tasty. Unfortunately, it's not actually that cheap.

I don't think you are alone in having a lot of money in cash.

@hank:
Jesus, the Balm of Gilead | Daystar Television
www.daystar.com/devotions/jesus-the-balm-of-gilead
Mar 18, 2013 ... Yes, there is a Balm of Gilead whose healing salve can mend a broken body. The healing properties of the balm of Gilead were known .

@Bobpa: Investopedia: Investing 101
Regards,
Ted
http://www.investopedia.com/university/beginner/

Are you there God? It's Me, Margaret.
Seriously, The Wall Street Journal Guide to Understanding Money and Investing is good for beginners: https://thriftbooks.com/w/wall-street-journal-guide-to-understanding-money-and-investing-wall-street-journal-guide-to-understanding-money--investing_kenneth-m-morris_alan-m-siegel/250418/?gclid=CLur7cCxpNICFZuNswoddKQM-A#isbn=0684869020&pcrid=70112878992&pkw=&pmt=&plc=
That's an older book, though, so it might not cover ETFs well, but it has all the basics on how things work explained clearly. There is a newer beginners book out, which is very popular though I haven't read it:
https://amazon.com/Beginners-Guide-Investing-Money-Smart/dp/1477463992/ref=sr_1_1?s=books&ie=UTF8&qid=1487790208&sr=1-1&keywords=investing+for+beginners
If she's a little more advanced, you could move her on to: https://amazon.com/Bogle-Mutual-Funds-Perspectives-Intelligent/dp/111908833X/ref=sr_1_1?s=books&ie=UTF8&qid=1487790690&sr=1-1&keywords=bogle+on+mutual+funds
That's a really good book on the importance of keeping costs low, indexing and diversification, but it might be too hard for the absolute beginner.

FYI: Fannie Mae and Freddie Mac shares took a nosedive Tuesday following a federal appeals court decision to stay a previous ruling that disallows investors from suing the U.S. government. The cases alleged that the government (taxpayers) illegally seized billions of dollars from the mortgage giants. Teresa Rivas reported on it Tuesday.
Over-the-counter shares of Fannie (FNMA) and Freddie (FMCC) slid 34.7% and 38.1%, respectively. Preferred shares were down similarly.
Call it a hitch – hedge funds and other distressed asset investors, who snapped up shares for pennies on the dollar expecting to get paid back won’t go quietly. Bill Ackman’s Pershing Square Capital Management is a major holder of common shares; Perry Capital and Bruce Berkowitz’ Fairholme Funds are major owners of the preferred shares.
Regards,
Ted
http://blogs.barrons.com/focusonfunds/2017/02/22/fannie-and-freddie-took-a-big-fall-will-bruce-berkowitz-fairholme-come-tumbling-after/tab/print/

Hi @Junkster
You noted: "Marty Fridson the most acclaimed junk expert said early last summer the overvaluation in junk was "staggering". Funny how the market rarely listens to the experts."
Ha.........yes. I read Mr. Fridson comments/thoughts.
But, I do believe that larger monies apparently are dictating this market place, too; not unlike other "surprise" areas.
I suspect algos in place for trading purposes, although adjustable/modifiable by humans; are causing directional moves/trends that come and go without apparent fundamental reasons for we regular retail humans. These functions also catch the "experts" by the butt, too.
One may select any market area from the http://finviz.com/futures.ashx list, let alone the thousands of other market choices that are tradeable and find those who have such a passion and knowledge of a particular investment area who make a fine monetary living. There are many traders on the planet earning a decent income trading coffee, sugar and bond CDS contracts.
A first person view for me into this strange world (at the time) comes from my "way back" machine. While traveling through Europe for 1 year, in 1973, with a female companion; we had the opportunity to stay with a Frenchman and his family for several days. His self employment was being the middle man for sellers and buyers of produce products throughout Europe. I observed his work during the very early morning hours for two days. He spoke several languages and used his land line phone making deals between customers in Italy or Poland or whatever country for apples, lettuce or what was needed. I recall he did have a teleprinter (online) for product pricing.
This of course, was before the technology of today and also dealing with currency pricing of various countries (pre-Euro). This was a most interesting experience for this traveler of a young age into this unknown world of commerce and money making.
An overview for me is that so much money is moving without regard to so-called fundamental aspects; that technical aspects do have an important meaning for those with the passion, understanding and time of the technical trending in play for a given investment. If one wants to be a pure value investor and is patient; create a list and monitor whatever investment area is of interest with a relative strength value below 30. Do one's best to discover why the RSI is at or below 30 for what you are monitoring. An RSI below 30 may be in place for a very good reason(s). @Junkster.........noted that you use price channels, yes?
Not unlike those who were thrilled with returns in 2016 from the domestic value equity area; now find the rotation back to the growth side of these large, mid and small caps. Obviously, very broad market sectors have playable sectors.
I don't suggest trading investment area patterns for the majority and is not the aspect of MFO. This house continues to move away from this.......from time constraints and passion; and moving more to a keep it simple.
As to a most simple basic example: 50% in a broad U.S fund, index or etf and 50% in a bond fund, index or etf of one's choice.
Samples: VTI and PIMIX
---YTD combo 3.7% (annualized forward for 2017 of 22.2%, w/o market blowups)
---1 year average combo = 19.7%
---3 year average combo = 8.2%
---5 year average combo = 11.2%
Okay, I've rambled way past this HY thread and far exceeding my annual dues rate.
Take care,
Catch

Article had this chart I thought I'd share...YTD SPX is up 5.65%.

FYI: CFRA’s Sam Stovall says he’s looking for a long-overdue “digestion of gains,” though he adds the pause will not likely result in the end of this bull market.
The run will continue, the chief investment strategist writes, thanks in part to improving earnings and inflation staying subdued. In support, he notes one indicator that’s close to getting triggered.
“If you need additional encouragement that a bear market is not just around the corner, history again may offer some more virtual Valium,” says Stovall, who delivers our call of the day.
Since 1945, there have been 27 years when the S&P has achieved gains in January and February. The stock index then finished up for the year (on a total-return basis) in every one those years, according to Stovall. That’s going 27 for 27, or batting a thousand.
Regards,
Ted
http://www.marketwatch.com/story/this-bullish-signal-has-never-been-wrong-and-its-about-to-flash-for-2017-2017-02-22/print

FYI: ong-term average stock returns smooth over the bull and bear markets that investors experience, and no two market cycles ever unfold the exact same way. Bull and bear markets can vary significantly in both duration and magnitude.
But there are other characteristics of bull markets that can also differ in meaningful ways, such as velocity, sources of return, and investor experience.
When it comes to analyzing bull markets, inflation, interest rates, equity valuations, earnings, and dividends all play a part.
Assessing the current economic environment in the context of historical U.S. and international bull markets can help set better expectations and reduce the risk of surprises that can lead to emotional decisions
Regards,
Ted
https://blog.thinknewfound.com/2017/02/anatomy-bull-market/

FYI:
Regards,
Ted
U.S.:
http://www.marketwatch.com/story/us-stocks-on-pause-after-record-rally-with-fed-minutes-ahead-2017-02-22/print
Europe:
http://www.marketwatch.com/story/european-stocks-at-yearly-highs-as-euro-pulls-back-german-sentiment-rises-2017-02-22/print
Asia:
http://www.marketwatch.com/story/asian-stocks-edge-up-ahead-of-fed-minutes-2017-02-21/print
Current Futures: Negative
http://finviz.com/futures.ashx

@hank said Mark Vaselkov made PRHYX what it became. I'd be reluctant to invest in a Price high yield fund without his being at the helm. From my experience their fixed income people are hit and miss - but Vaselkov is a great one.
Sounds like you do know junk bonds being spot on in your statement above. Not sure about junk bond experts of which I am certainly not. I recall when "experts" such as Icahn and Gundlach were looking for a junk bond market meltdown late 2015/early 2016. But instead of a meltdown we get a 20%+ meltup. Marty Fridson the most acclaimed junk expert said early last summer the overvaluation in junk was "staggering". Funny how the market rarely listens to the experts.

For what interest it holds. Wonder what the next conference call will sound like
http://www.fairholmefundsinc.com/Documents/PublicConferenceCall20161118.pdf

The Fairholme Focused Income Fund fared better than FAIRX: It was down 6.19% today and is still up for the year by 2.51%. FCOIX is managed by Bruce Berkowitz and he has a 6.76% holding in Fannie Mae Preferred which also tumbled today. FOCIX was up 32% in 2016. It was a good day to head for the exits.

Confused.
1) name of new fund is same as name of existing fund ?!?!?! and
2) Today is good time to start a high yield fund?
what am i missing?

@VF - I don't think you're missing anything.
TRP may have missed the boat in closing PRHYX prematurely - expecting a bear market that failed to develop. On the other hand, perhaps it just became too large and unwieldy. @Junkster is the expert here. I know very little about the high yield market. What little exposure I have is indirectly through allocation funds like RPSIX. And I've no desire to jump into this or any high yield fund.
If I follow correctly, Price will have (at least) 3 high yield funds:
High Yield,
International High Yield
U.S. High Yield
Mark Vaselkov made PRHYX what it became. I'd be reluctant to invest in a Price high yield fund without his being at the helm. From my experience their fixed income people are hit and miss - but Vaselkov is a great one.

New fund is "US High Yield". PRHYX currently "only" about 71% US bonds. Foreign bonds definitely not EM or Frontier heavy.
Not sure if now is the right time, but in 30 years I doubt anyone will say the fund would have been better if only they had launched it 5 years earlier/later... unless it fails and someone on MFO remembers this thread. Maybe Ted will be around then to post it.