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Buy low, sell high for index funds?

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  • #16
    If you want to play the odds, you have a 50/50 chance that tomorrows price will be higher than todays price.

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    • #17
      Originally posted by jacoavlu View Post

      and what difference did it make?
      In my case redirected new funds to RE and business investments that continued to appreciate while the markets took the 30% hit (and prior), then did some market rebalancing heading back up to further enhance. Hence a very good year all around.

      Felt good to pay off all that debt while still on track for another positive year for RE/business income/investment given no more interest to pay to a lender, and investments in new business offerings. While gross income grew, net income improved relative to growth with these enhancements.

      Essentially new resources reallocated to positive returns at any given point in time, rather than suffering 30% market drop then wait months for recovery. It is though a diversification play as much as a performance play.

      A double dip recession would be ideal for me (financially) as with no more debt to worry about I want to inject a few bucks into the markets. Talk about another negative GDP quarter with the new wave of local business closures but I'm not holding my breath as the vaccines may limit breadth, magnitude and duration closures. So I may settle for smaller injections on regular corrections. With no debt and the prospect of a major COVID business shock largely behind us (in the South) a smaller EF as you encourage (to limit drag on returns) may be in order.

      A lot more than the equities markets come to my mind around the term investment. Expand your horizons. Sometimes investment is made yes, for raw returns. My RE was because I needed more space for the business. My business was for autonomy as much as it was for growth. Sometimes because it's simply an interest. Investing in another provider may buy me more free time even if it comes with a more muted return. "And what difference did it make?" Plenty. Plenty of good reasons to invest outside of the market but at least I want to avoid jumping in expecting with strong conviction a near term nosedive on that infusion.

      See below. I know I know, "you're not Clapton".

      https://www.nytimes.com/2016/11/16/a...c-clapton.html

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      • #18
        you had all that cash like $2M you'd been holding through a bull market, and you predicted a recession yet you didn't sell at the top, and instead of buying at the bottom with "dry powder" you paid off low interest debt - including your zero percent interest debt ? - sounds to me more like lesson learned is that even the savants can't time the market successfully

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        • #19
          Originally posted by Tangler View Post
          Peds and Lordosis said it. Pick an Asset Allocation (AA) create an investment policy statement (IPS) which is a document that helps you describe your plan.

          When you get $ buy for the long run and ignore the noise.

          Time in the market beats timing the market.

          If you have a short time horizon you should not be buying stocks. If you have a long time horizon, you will most often be best off just to buy as soon as you have $ to buy with. (Lump sum).

          Lump sum usually wins over long time periods and trying to time things gets messy.

          If you insist on trying to time it, I suggest you read the book value averaging (by Michael Edelson) and create a value path spread sheet, but recognize that people are irrational, emotional, flawed, pattern seeking primates and you are running the risk of screwing it up.



          I would just buy every pay period. Put it in and ignore the noise. You will be Dollar cost averaging (sort of) when you do this and you will be fine in the long run.
          I highly second this reccomendation.

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          • #20
            Originally posted by jacoavlu View Post
            you had all that cash like $2M you'd been holding through a bull market, and you predicted a recession yet you didn't sell at the top, and instead of buying at the bottom with "dry powder" you paid off low interest debt - including your zero percent interest debt ? - sounds to me more like lesson learned is that even the savants can't time the market successfully
            I know right. Making so many mistakes. Learning so much from you.

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            • #21
              Originally posted by EntrepreneurMD View Post
              However when a big one happens a lump sum of my dry powder will likely be in order.
              Just like this March? Oh wait..

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              • #22
                Originally posted by EntrepreneurMD View Post

                I know right. Making so many mistakes. Learning so much from you.
                Actually, your entrepreneurial spirit for a physician is very helpful to some.
                The fog is too thick to see the crystal ball you have. A picture might help.

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                • #23
                  Originally posted by TheDangerZone View Post

                  Just like this March? Oh wait..
                  If you’ll remember, he also didn’t think we’d see the Dow at 29k any time soon.

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                  • #24
                    Originally posted by TheDangerZone View Post

                    Just like this March? Oh wait..
                    ...October.

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                    • #25
                      No OP

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