Author Topic: Welp, I'm going to take a stab at timing the market  (Read 98766 times)

markbike528CBX

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Re: Welp, I'm going to take a stab at timing the market
« Reply #700 on: August 28, 2020, 01:19:01 PM »

Dude, you gotta own it. What you are doing is the *definition* of market timing.

Fair enough. I had said that I'm not trying to time it because I'll happily jump back in with the SP500 at 3500 when the situation normalizes a little.

Hey @Full_Beard !  Are you in or isn't this normalized a little?  Top is IN!


Full_Beard

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Re: Welp, I'm going to take a stab at timing the market
« Reply #701 on: August 31, 2020, 05:53:16 PM »
Ha, nope, the irrational exuberance continues, lost opportunity costs rise, but I'm still sidelining my stash.

You say the top is in? I see zero evidence that equities are going to be derailed this week.

markbike528CBX

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Re: Welp, I'm going to take a stab at timing the market
« Reply #702 on: August 31, 2020, 09:53:17 PM »
Ha, nope, the irrational exuberance continues, lost opportunity costs rise, but I'm still sidelining my stash.

You say the top is in? I see zero evidence that equities are going to be derailed this week.

Au contraire, the TOP is always IN, says the guru Thorstache :-)

des999

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Re: Welp, I'm going to take a stab at timing the market
« Reply #703 on: September 01, 2020, 06:39:51 AM »
Ha, nope, the irrational exuberance continues, lost opportunity costs rise, but I'm still sidelining my stash.

You say the top is in? I see zero evidence that equities are going to be derailed this week.

sorry if I missed it, but when did you go to cash? 

dragoncar

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Re: Welp, I'm going to take a stab at timing the market
« Reply #704 on: September 02, 2020, 03:03:49 AM »
Ha, nope, the irrational exuberance continues, lost opportunity costs rise, but I'm still sidelining my stash.

You say the top is in? I see zero evidence that equities are going to be derailed this week.

So when are you thinking?  S&P @ 4000?

talltexan

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Re: Welp, I'm going to take a stab at timing the market
« Reply #705 on: September 02, 2020, 06:50:26 AM »
Look, there are a lot of people who thought this original experiment was dumb, but who also have no good explanation for why SP is > 3,500 today.

My stab at it: the incredibly loose monetary and fiscal policy of the first half of the year. The problem: we're going to lose one of those.

waltworks

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Re: Welp, I'm going to take a stab at timing the market
« Reply #706 on: September 02, 2020, 07:56:48 AM »
Look, there are a lot of people who thought this original experiment was dumb, but who also have no good explanation for why SP is > 3,500 today.

My stab at it: the incredibly loose monetary and fiscal policy of the first half of the year. The problem: we're going to lose one of those.

That's the thing, though, you don't *need* to explain why the market does what it does - unless you're one of those financial-headline writers. Which as an aside I think would be a hilariously fun job...

The market is a herd of emotional humans, plus some black-box algos. It's inherently super unpredictable. The S&P could be a 2k right now and I'd shrug and buy more, and it could be at 4k and I'd do the same.

-W

talltexan

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Re: Welp, I'm going to take a stab at timing the market
« Reply #707 on: September 02, 2020, 08:57:40 AM »
Indeed I am mad at myself for not upping contributions to retirement accounts during March and April. When you're in an environment in which prices are down 30%, it is incredibly hard to jump into the teeth of the market like Capt. Jack jumps into the mouth of the Kraken at the end of one of the Pirates of the Caribbean movies.

v8rx7guy

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Re: Welp, I'm going to take a stab at timing the market
« Reply #708 on: September 02, 2020, 09:08:45 AM »
I think this is the current situation:

junioroldtimer sold 892.949 shares on Feb 7, 2019 at $67.59 each converting $60,354.43 into cash

junioroldtimer purchased 907.167 shares on Mar 13, 2020 at $66.14 each for gain in position of $1,294.78

However, he missed out on dividends totaling $1,282.58 during this time, for a market timing gain of $12.20 .  he had the initial $60,354.43 invested in an Ally savings account for that same ~1 year at a rate of 2.3% compounded monthly for a gain of $1,402.88 .

This brings the total position gain of "Market timing attempt #1" to be a gain of $1,415.08

Next, junioroldtimer sold 469.41 shares on Mar 27, 2020 at $63.91 each converting $30,000 into cash.

On Jun 5, 2020 the closing price was $78.85, meaning he had cost himself $7,012.99 after 10 weeks.
On Sep 1, 2020 the closing price was $87.08 meaning he had cost himself $10,876.23 plus $159.08 in dividends after 23 weeks

This brings the total position gain of "Market timing attempt #2" to be a loss of $10,876.23

This is a potential total endeavor loss (sum of attempts #1 &#2) of $9,461.15
« Last Edit: September 02, 2020, 04:27:39 PM by v8rx7guy »

HBFIRE

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Re: Welp, I'm going to take a stab at timing the market
« Reply #709 on: September 02, 2020, 09:21:06 AM »
Thanks for the update and running the numbers @v8rx7guy.   I hadn't been following this thread closely and didn't realize he sold again.  I guess market timing gets addicting.  All that trouble for a total gain of $1,390, and that was a rare win.

I did sell some stock about 3 weeks but not because I really wanted to, we decided to put a down payment on a home.
« Last Edit: September 02, 2020, 09:23:14 AM by HBFIRE »

frugalnacho

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Re: Welp, I'm going to take a stab at timing the market
« Reply #710 on: September 02, 2020, 09:23:49 AM »
Indeed I am mad at myself for not upping contributions to retirement accounts during March and April. When you're in an environment in which prices are down 30%, it is incredibly hard to jump into the teeth of the market like Capt. Jack jumps into the mouth of the Kraken at the end of one of the Pirates of the Caribbean movies.

I disagree.  Everything that MMM, and JL Collins, etc have drilled into me, as well as this forum, and all the finance books I've read either as MMM recommendations, or ones I've independently sought out have prepared me for that down turn.  I saved as much as possible and threw everything into the market.  I even pulled $10k out of my emergency fund (savings account) and threw it into my brokerage account on March 16, 2020 since prices were so low.  I was doing back flips into that kraken.   

v8rx7guy

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Re: Welp, I'm going to take a stab at timing the market
« Reply #711 on: September 02, 2020, 09:31:28 AM »
Thanks for the update and running the numbers @v8rx7guy.   I hadn't been following this thread closely and didn't realize he sold again.  I guess market timing gets addicting.  All that trouble for a total gain of $1,390, and that was a rare win.

I did sell some stock about 3 weeks but not because I really wanted to, we decided to put a down payment on a home.

Yes, it was a bit buried, but here is the quote:

This move might have most forum regulars face palming (more than this entire thread).

Last night I put in a trade that was executed this morning selling 469.41 shares @ $63.91 each, taking a loss of $1,046.78 from my purchase on 3/15. My hypothesis is that VTSAX will again be lower than its current price at which point I will buy back in at a discount. Keep your fingers crossed for me and stay healthy everyone.

DadJokes

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Re: Welp, I'm going to take a stab at timing the market
« Reply #712 on: September 02, 2020, 11:00:25 AM »
LOL

That guy sold almost right at the bottom.

BicycleB

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Re: Welp, I'm going to take a stab at timing the market
« Reply #713 on: September 02, 2020, 03:39:52 PM »
LOL

That guy sold almost right at the bottom.

Market timing is really tough!!!

Indeed I am mad at myself for not upping contributions to retirement accounts during March and April. When you're in an environment in which prices are down 30%, it is incredibly hard to jump into the teeth of the market like Capt. Jack jumps into the mouth of the Kraken at the end of one of the Pirates of the Caribbean movies.

I disagree.  Everything that MMM, and JL Collins, etc have drilled into me, as well as this forum, and all the finance books I've read either as MMM recommendations, or ones I've independently sought out have prepared me for that down turn.  I saved as much as possible and threw everything into the market.  I even pulled $10k out of my emergency fund (savings account) and threw it into my brokerage account on March 16, 2020 since prices were so low.  I was doing back flips into that kraken.   

FIREd here, no income but my modest (very modest!) investments. Rebalanced on March 10, basically selling bond fund and buying stock fund. One of my informal rules (all I have) is "don't rebalance more than once every three months", so I missed the bottom.

The buyers on this thread bought early compared to the bottom. The seller sold late compared to the bottom. Anecdata only??

GuitarStv

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Re: Welp, I'm going to take a stab at timing the market
« Reply #714 on: September 02, 2020, 03:50:52 PM »
LOL

That guy sold almost right at the bottom.

Market timing is really tough!!!

To be fair though . . . all indications did make it seem like the market was about to plummet when he sold.  He did what I kinda thought I should do.  The market makes no sense at all, and trying to make sense of it is often doomed to failure.  Fortunately I remembered that.

BigMoneyJim

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Re: Welp, I'm going to take a stab at timing the market
« Reply #715 on: September 02, 2020, 04:11:22 PM »
Yeah, learning from others' expriences is a lot less costly than learning from my own!

bthewalls

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Re: Welp, I'm going to take a stab at timing the market
« Reply #716 on: September 02, 2020, 04:27:05 PM »
Ok...letís cut to it!...

Market is bonkers and artificially propped up...end of

Whose gonna market time and go to cash.? Or even partially cash

Barry

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Re: Welp, I'm going to take a stab at timing the market
« Reply #717 on: September 02, 2020, 05:09:42 PM »
Ha, nope, the irrational exuberance continues, lost opportunity costs rise, but I'm still sidelining my stash.

You say the top is in? I see zero evidence that equities are going to be derailed this week.

sorry if I missed it, but when did you go to cash?

This thread got some legs again.

I didn't go all cash; I'm in bonds, earning 5-6% which is meager these days.

But, here's my short story: I started saving when I got my first job in the fall of 1998. I've been mostly buying the SP500 index fund since that time and have amassed $1.4M while working for non-profits and the government. My wife and I are relatively frugal, raising 3 kids in Alaska. I'll be out of student debt this year and our house will be paid off in 5 years. In April 2019, I ignored the traditional advice and pulled everything out of the market for a variety of reasons not worth debating. A year later, the pandemic hit, the market dropped, quickly rebounded, and now has moved even higher. I plan to get back in when the insanity diminishes. When will that happen; will it ever happen? I don't pretend to have a decent guess. Folks far wiser in economics and stocks have put forth several theories to explain today's situation. So maybe I continue contributing the maximum permitted for the next 10 years and stick with bonds, and then move into the next phase of my life with $2M instead of $4M. I can live with that.

BigMoneyJim

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Re: Welp, I'm going to take a stab at timing the market
« Reply #718 on: September 02, 2020, 10:07:33 PM »
Whose gonna market time and go to cash.? Or even partially cash

I'm going to put maybe 6 figures *into* the market.



Because I'm about to sell my house, and the money will go into my asset allocation plan which is mostly stock index funds.

EscapeVelocity2020

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Re: Welp, I'm going to take a stab at timing the market
« Reply #719 on: September 02, 2020, 10:42:51 PM »
Whose gonna market time and go to cash.? Or even partially cash

I'm going to put maybe 6 figures *into* the market.
Because I'm about to sell my house, and the money will go into my asset allocation plan which is mostly stock index funds.

Wow, I'm having a hard time taking money out because I was conservative but now with the run up, maybe a little over-exposed...  but only putting 401k contributions in from now on.  Lots of dry powder accumulating with no good options (bonds suck, equities are over priced, maybe buy a rental property?)...  only getting 0.5% return on cash with no loss (depending on how you view inflation) seems OK, I guess? 

But then I watch S&P500 go up ~1% every day...  what a weird investing world we find ourselves in...  Can't sell, but can't pinch my nose and buy more either.

daverobev

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Re: Welp, I'm going to take a stab at timing the market
« Reply #720 on: September 03, 2020, 02:03:15 AM »
Whose gonna market time and go to cash.? Or even partially cash

I'm going to put maybe 6 figures *into* the market.
Because I'm about to sell my house, and the money will go into my asset allocation plan which is mostly stock index funds.

Wow, I'm having a hard time taking money out because I was conservative but now with the run up, maybe a little over-exposed...  but only putting 401k contributions in from now on.  Lots of dry powder accumulating with no good options (bonds suck, equities are over priced, maybe buy a rental property?)...  only getting 0.5% return on cash with no loss (depending on how you view inflation) seems OK, I guess? 

But then I watch S&P500 go up ~1% every day...  what a weird investing world we find ourselves in...  Can't sell, but can't pinch my nose and buy more either.

In terms of "explain"... it seems to me that it's pretty much, lots and lots of QE and nowhere else for it to go. Bonds? Near zero return - what's the point. Housing sure, but we're talking about LOTS of QE here (prices seem to be going up in certain markets - eg Vancouver and Toronto, from what I understand), so hard to do. People (rich people) seem to be just... throwing money at Apple (and Tesla and...).

I read a piece yesterday saying the market value of Apple is now greater than the entire FTSE 100. I mean... wow.

BigMoneyJim

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Re: Welp, I'm going to take a stab at timing the market
« Reply #721 on: September 03, 2020, 02:40:08 AM »
Yeah, I'm selling my house because I want to move, and I don't want to own again for probably at least ten years. Certainly not in the next 5.

It feels really weird to think about dumping money into the market right now, but what else am I going to do with it? I already have a 2-year cash cushion, and I still think one reasonably likely way "out" of this situation is inflation instead of a nominal market crash, in which cash tons of cash would be bad.

But mainly I'm a passive investor and anti-market-timer. As crazy as it feels, if I suddenly get a big pile of money, it gets invested per my plan.

daverobev

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Re: Welp, I'm going to take a stab at timing the market
« Reply #722 on: September 03, 2020, 05:04:05 AM »
Yeah, I'm selling my house because I want to move, and I don't want to own again for probably at least ten years. Certainly not in the next 5.

It feels really weird to think about dumping money into the market right now, but what else am I going to do with it? I already have a 2-year cash cushion, and I still think one reasonably likely way "out" of this situation is inflation instead of a nominal market crash, in which cash tons of cash would be bad.

But mainly I'm a passive investor and anti-market-timer. As crazy as it feels, if I suddenly get a big pile of money, it gets invested per my plan.

Putting it into *a* property wouldn't, I think, be a terrible idea because at least in theory, the value will track the value of property generally. So if in ten years you find house prices have doubled but stocks have stayed flat, well, bleh. But if house prices have doubled and you own a house and want to own a different house, not a massive problem. Of course property is local, renting out property is risky, there are transaction costs... Why not buy two, to mitigate risk; take a mortgage to mitigate inflation risk... Depends on how much you have in stocks already, tolerances, and so on.

des999

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Re: Welp, I'm going to take a stab at timing the market
« Reply #723 on: September 03, 2020, 06:47:18 AM »
Ha, nope, the irrational exuberance continues, lost opportunity costs rise, but I'm still sidelining my stash.

You say the top is in? I see zero evidence that equities are going to be derailed this week.

sorry if I missed it, but when did you go to cash?

This thread got some legs again.

I didn't go all cash; I'm in bonds, earning 5-6% which is meager these days.

But, here's my short story: I started saving when I got my first job in the fall of 1998. I've been mostly buying the SP500 index fund since that time and have amassed $1.4M while working for non-profits and the government. My wife and I are relatively frugal, raising 3 kids in Alaska. I'll be out of student debt this year and our house will be paid off in 5 years. In April 2019, I ignored the traditional advice and pulled everything out of the market for a variety of reasons not worth debating. A year later, the pandemic hit, the market dropped, quickly rebounded, and now has moved even higher. I plan to get back in when the insanity diminishes. When will that happen; will it ever happen? I don't pretend to have a decent guess. Folks far wiser in economics and stocks have put forth several theories to explain today's situation. So maybe I continue contributing the maximum permitted for the next 10 years and stick with bonds, and then move into the next phase of my life with $2M instead of $4M. I can live with that.

thanks for the follow up / backstory.  Good luck.  That seems to be the hardest thing for people to do, which is why I don't sell stock.  Getting out is one thing, but it seems folks are always too gun shy to get back in and miss huge run ups.  It seems much easier for me to stay the course.  I mean, it sounds like you did really well from 1998 to 2019, why change?


FLBiker

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Re: Welp, I'm going to take a stab at timing the market
« Reply #724 on: September 03, 2020, 10:42:04 AM »
Yeah, I'm selling my house because I want to move, and I don't want to own again for probably at least ten years. Certainly not in the next 5.

It feels really weird to think about dumping money into the market right now, but what else am I going to do with it? I already have a 2-year cash cushion, and I still think one reasonably likely way "out" of this situation is inflation instead of a nominal market crash, in which cash tons of cash would be bad.

But mainly I'm a passive investor and anti-market-timer. As crazy as it feels, if I suddenly get a big pile of money, it gets invested per my plan.

Thanks for this -- I'm in a similar position -- we've got ~$50K from a house sale.  I'm on the phone right now transferring it from US to Canada so I can dump it in index ETFs at Questrade (we just moved from the US to Canada, so I can Vanguard no more).  It's weird because I "know" the market is overpriced right now and I "know" it's going to fall, but I also know that you don't market time, so I'm doing it anyways. :)

I'm keeping more cash on hand than I usually would, but that's because my job isn't as secure as usual.  Even doing that, though, I can't justify keeping out this $50K.

the_fixer

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Re: Welp, I'm going to take a stab at timing the market
« Reply #725 on: September 09, 2020, 07:31:55 AM »
Indeed I am mad at myself for not upping contributions to retirement accounts during March and April. When you're in an environment in which prices are down 30%, it is incredibly hard to jump into the teeth of the market like Capt. Jack jumps into the mouth of the Kraken at the end of one of the Pirates of the Caribbean movies.
Shrugs and points out that the Kraken is a mythical creature why fear the unknown?

Luvs me a good sale, rolled a bunch of money in that I was using to churn bank accounts, part of my EF while it was at or right around the low earlier this year. Kicked up my contribution to the max my company will allow 70% and maxed my 401k before it went back up.

Even did a rollover to Roth with an old retirement that just became available to me late last year that I had been trying to decide what to do with it.


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talltexan

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Re: Welp, I'm going to take a stab at timing the market
« Reply #726 on: September 12, 2020, 08:18:01 AM »
Legit props for the Roth roll-over. A lot of wise people manage to time these things to take advantage of market drops.

Retire-Canada

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Re: Welp, I'm going to take a stab at timing the market
« Reply #727 on: September 12, 2020, 09:20:24 AM »
I'm on the phone right now transferring it from US to Canada so I can dump it in index ETFs at Questrade (we just moved from the US to Canada, so I can Vanguard no more)

All of my ETFs at QT are in Vanguard products. Including holding VTI in USD. You can buy anything you want via your QT account.

secondcor521

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Re: Welp, I'm going to take a stab at timing the market
« Reply #728 on: September 12, 2020, 11:52:45 AM »
Legit props for the Roth roll-over. A lot of wise people manage to time these things to take advantage of market drops.

I did half of mine for this year on March 17.  It was a bit scary emotionally but mentally I thought it would turn out well.  Looking backward from now I'm glad I did.

(Only did half because I feel pretty strongly about dialing in my tax situation in December when I pretty much know all the numbers for the year.)