Author Topic: Welp, I'm going to take a stab at timing the market  (Read 119278 times)

secondcor521

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Re: Welp, I'm going to take a stab at timing the market
« Reply #750 on: February 06, 2021, 08:05:09 PM »
Don't forget about taxes.

If this were in a taxable account he would probably owe some amount of federal capital gains tax on the 2/7/2019 and 3/27/2020 sales, possibly at short term rates.  Plus probably state income taxes.

He would also owe ordinary income taxes on his Ally savings account interest, again at the federal and state level.

He did avoid income taxes on the dividends he didn't receive. :)

A LTBH person would only owe taxes on the dividends, but probably at the qualified dividend rate, which can be as low as 0% plus state taxes, and at worst is probably 15% plus state taxes.

talltexan

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Re: Welp, I'm going to take a stab at timing the market
« Reply #751 on: February 08, 2021, 09:17:59 AM »
It's probably unfair for us to speculate about taxes, because OPs tax situation could have changed for reasons unrelated to the project (like getting a much higher-paying job, or getting married to a spouse with a very different tolerance for risk).

bthewalls

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Re: Welp, I'm going to take a stab at timing the market
« Reply #752 on: February 11, 2021, 04:53:56 PM »
Itís really good to read the maths behind this......very convincing

v8rx7guy

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Re: Welp, I'm going to take a stab at timing the market
« Reply #753 on: February 11, 2021, 05:26:02 PM »
Itís really good to read the maths behind this......very convincing

This is my first time using a spreadsheet that I set up for this and I had an issue with the dividends formula.  Should be fixed now.

JAYSLOL

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Re: Welp, I'm going to take a stab at timing the market
« Reply #754 on: February 12, 2021, 07:51:33 AM »
Ouch.  This really highlights that when market timers ďwinĒ, they actually lose. 

Wintergreen78

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Re: Welp, I'm going to take a stab at timing the market
« Reply #755 on: February 14, 2021, 01:49:38 PM »
Itís really good to read the maths behind this......very convincing

This is my first time using a spreadsheet that I set up for this and I had an issue with the dividends formula.  Should be fixed now.

I personally love this approach to evaluating trades, no need to get into a big theoretical discussion, just look at the numbers.

So, as far as I can tell his initial $60,354 would be $89,323 based on price appreciation alone. How much would it be after dividends are included?

talltexan

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Re: Welp, I'm going to take a stab at timing the market
« Reply #756 on: February 16, 2021, 11:27:41 AM »
Man, it's really interesting going back to the early days of this thread and re-reading the stuff about Donald Trump being taken down by the Mueller investigation.

Getting the stock market right is hard. Gaming out the cause and effect in modern American politics has also been difficult. One year ago this week it looked like Sanders was coasting to the Democratic nomination.

v8rx7guy

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Re: Welp, I'm going to take a stab at timing the market
« Reply #757 on: April 16, 2021, 09:46:47 AM »
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
On Nov 19, 2020 the closing price was $89.66 meaning he had cost himself $12,087.31 plus $312.06 in dividends after 34 weeks
On Feb 5, 2021 the closing price was $99.32 meaning he had cost himself $16,621.81 plus $489.55 in dividends after 45 weeks
On Apr 14, 2021 the closing price was $105.40 meaning he had cost himself $19,475.82 plus $641.82 in dividends after 55 weeks

This brings the total position gain of "Market timing attempt #2" to be a loss of $20,117.65

This is a potential total endeavor loss (sum of attempts #1 &#2) of $18,702.57
« Last Edit: April 16, 2021, 09:54:36 AM by v8rx7guy »

Dibbels81

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Re: Welp, I'm going to take a stab at timing the market
« Reply #758 on: August 07, 2021, 07:40:18 AM »
Hey v8rx7guy, how about a 2 1/2 year update?

secondcor521

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Re: Welp, I'm going to take a stab at timing the market
« Reply #759 on: August 07, 2021, 08:27:02 AM »
VTSAX closed at 111.37 on Friday, so as a rough additional amount it's

(469.41 * (111.37 - 105.40)) = $2,802.38

probably plus another half a percent or so in dividends, so just the #2 part would likely be over $23K.

Dibbels81

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Re: Welp, I'm going to take a stab at timing the market
« Reply #760 on: August 07, 2021, 09:42:00 AM »
VTSAX closed at 111.37 on Friday, so as a rough additional amount it's

(469.41 * (111.37 - 105.40)) = $2,802.38

probably plus another half a percent or so in dividends, so just the #2 part would likely be over $23K.

Come on, now this is v8rx7g's baby. Doing the math yourself is like taking the carving knife away from Grandpa. Sure, we're all capable of slicing the turkey ourselves, but the satisfaction it brings Grandpa is worth waiting the extra few minutes. 

v8rx7guy

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Re: Welp, I'm going to take a stab at timing the market
« Reply #761 on: August 07, 2021, 11:00:53 AM »
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
On Nov 19, 2020 the closing price was $89.66 meaning he had cost himself $12,087.31 plus $312.06 in dividends after 34 weeks
On Feb 5, 2021 the closing price was $99.32 meaning he had cost himself $16,621.81 plus $489.55 in dividends after 45 weeks
On Apr 14, 2021 the closing price was $105.40 meaning he had cost himself $19,475.82 plus $641.82 in dividends after 55 weeks
On August 6, 2021 the closing price was $111.39 meaning he had cost himself $22,287.59 plus $794.85 in dividends after 70 weeks

This brings the total position gain of "Market timing attempt #2" to be a loss of $23,082.44

This is a potential total endeavor loss (sum of attempts #1 &#2) of $21,667.36

secondcor521

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Re: Welp, I'm going to take a stab at timing the market
« Reply #762 on: August 07, 2021, 11:12:47 AM »
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
On Nov 19, 2020 the closing price was $89.66 meaning he had cost himself $12,087.31 plus $312.06 in dividends after 34 weeks
On Feb 5, 2021 the closing price was $99.32 meaning he had cost himself $16,621.81 plus $489.55 in dividends after 45 weeks
On Apr 14, 2021 the closing price was $105.40 meaning he had cost himself $19,475.82 plus $641.82 in dividends after 55 weeks
On August 6, 2021 the closing price was $111.39 meaning he had cost himself $22,287.59 plus $794.85 in dividends after 70 weeks

This brings the total position gain of "Market timing attempt #2" to be a loss of $23,082.44

This is a potential total endeavor loss (sum of attempts #1 &#2) of $21,667.36

Sounds about right.

;-)

theoverlook

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Re: Welp, I'm going to take a stab at timing the market
« Reply #763 on: August 10, 2021, 09:40:07 AM »
Meanwhile I did nothing and changed nothing about my strategy between February 2019 and August 2021 and my liquid net worth went up by 95% over that period.

HamsterStache

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Re: Welp, I'm going to take a stab at timing the market
« Reply #764 on: September 26, 2021, 08:36:55 AM »
Meanwhile I did nothing and changed nothing about my strategy between February 2019 and August 2021 and my liquid net worth went up by 95% over that period.

Between the market and no daycare costs, plus stimulus, the pandemic has been extremely kind to our net worth. I realize we have been extremely fortunate in that respect as we both continued working for most of the time and unemployment covered about 100% of lost income.

friedmmj

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Re: Welp, I'm going to take a stab at timing the market
« Reply #765 on: November 09, 2021, 09:28:53 AM »
They did get back in but will never admit it.  No one likes to talk about the hands they lost, only their aces.

JL Collins bailed out in 1987 at the bottom but at least he is teaching others why that was a bad idea.
The secret is bailing out when things are bad, but not as bad as they eventually get.

This situation has been a gift financially because the damage can be estimated well in advance: 2-2.5 Spread, 1-4% fatality. No vaccine. Many, many, many people will lose their lives before we can mitigate this. A true flattening of the curve will take 12 months or more of the current economic shutdown. Pick a stock market bottom in your mind and slice it in half.

How's that working for you?

DadJokes

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Re: Welp, I'm going to take a stab at timing the market
« Reply #766 on: November 09, 2021, 10:18:58 AM »
They did get back in but will never admit it.  No one likes to talk about the hands they lost, only their aces.

JL Collins bailed out in 1987 at the bottom but at least he is teaching others why that was a bad idea.
The secret is bailing out when things are bad, but not as bad as they eventually get.

This situation has been a gift financially because the damage can be estimated well in advance: 2-2.5 Spread, 1-4% fatality. No vaccine. Many, many, many people will lose their lives before we can mitigate this. A true flattening of the curve will take 12 months or more of the current economic shutdown. Pick a stock market bottom in your mind and slice it in half.

How's that working for you?

Chuck hasn't posted since that day, so I doubt you'll get an answer.

dragoncar

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Re: Welp, I'm going to take a stab at timing the market
« Reply #767 on: November 09, 2021, 10:36:47 AM »
They did get back in but will never admit it.  No one likes to talk about the hands they lost, only their aces.

JL Collins bailed out in 1987 at the bottom but at least he is teaching others why that was a bad idea.
The secret is bailing out when things are bad, but not as bad as they eventually get.

This situation has been a gift financially because the damage can be estimated well in advance: 2-2.5 Spread, 1-4% fatality. No vaccine. Many, many, many people will lose their lives before we can mitigate this. A true flattening of the curve will take 12 months or more of the current economic shutdown. Pick a stock market bottom in your mind and slice it in half.

How's that working for you?

Chuck hasn't posted since that day, so I doubt you'll get an answer.

Oh man thatís ominous

BicycleB

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Re: Welp, I'm going to take a stab at timing the market
« Reply #768 on: November 09, 2021, 02:13:15 PM »
They did get back in but will never admit it.  No one likes to talk about the hands they lost, only their aces.

JL Collins bailed out in 1987 at the bottom but at least he is teaching others why that was a bad idea.
The secret is bailing out when things are bad, but not as bad as they eventually get.

This situation has been a gift financially because the damage can be estimated well in advance: 2-2.5 Spread, 1-4% fatality. No vaccine. Many, many, many people will lose their lives before we can mitigate this. A true flattening of the curve will take 12 months or more of the current economic shutdown. Pick a stock market bottom in your mind and slice it in half.

How's that working for you?

Chuck hasn't posted since that day, so I doubt you'll get an answer.

Oh man thatís ominous

I was going to post a joke, but anyone could have suffered a fatality at that point. I hope Chuck's ok, healthwise.

ChpBstrd

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Re: Welp, I'm going to take a stab at timing the market
« Reply #769 on: November 09, 2021, 02:17:39 PM »
They did get back in but will never admit it.  No one likes to talk about the hands they lost, only their aces.

JL Collins bailed out in 1987 at the bottom but at least he is teaching others why that was a bad idea.
The secret is bailing out when things are bad, but not as bad as they eventually get.

This situation has been a gift financially because the damage can be estimated well in advance: 2-2.5 Spread, 1-4% fatality. No vaccine. Many, many, many people will lose their lives before we can mitigate this. A true flattening of the curve will take 12 months or more of the current economic shutdown. Pick a stock market bottom in your mind and slice it in half.

How's that working for you?

Chuck hasn't posted since that day, so I doubt you'll get an answer.

Oh man thatís ominous

I was going to post a joke, but anyone could have suffered a fatality at that point. I hope Chuck's ok, healthwise.
Maybe someone took a stab at Chuck instead of timing the market? I'll pick up my bad taste award on the way out.

mies

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Re: Welp, I'm going to take a stab at timing the market
« Reply #770 on: November 09, 2021, 02:50:53 PM »
They did get back in but will never admit it.  No one likes to talk about the hands they lost, only their aces.

JL Collins bailed out in 1987 at the bottom but at least he is teaching others why that was a bad idea.
The secret is bailing out when things are bad, but not as bad as they eventually get.

This situation has been a gift financially because the damage can be estimated well in advance: 2-2.5 Spread, 1-4% fatality. No vaccine. Many, many, many people will lose their lives before we can mitigate this. A true flattening of the curve will take 12 months or more of the current economic shutdown. Pick a stock market bottom in your mind and slice it in half.

How's that working for you?

Chuck hasn't posted since that day, so I doubt you'll get an answer.

Oh man thatís ominous

I was going to post a joke, but anyone could have suffered a fatality at that point. I hope Chuck's ok, healthwise.
Maybe someone took a stab at Chuck instead of timing the market? I'll pick up my bad taste award on the way out.
He stabbed himself trying to catch that falling knife.

Davnasty

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Re: Welp, I'm going to take a stab at timing the market
« Reply #771 on: November 09, 2021, 03:14:09 PM »
I liquidated all of my non-tax deferred holdings on March 4th. It was by far one of the best financial decisions of my life.

I'll get back in the day they announce a vaccine. This is going to get much worse.

I doubt this is actually how things played out, but let's run the numbers assuming VTSAX and a "vaccine announced" on December 11, 2020 - the date emergency use authorization was given for the Pfizer vaccine:

VTSAX (close) 3/4/20: $77.25

VTSAX (close) 12/11/20: $92.59 (+19.86%)


maybe we could forgive ~5% based on this ↓ ? Although buying in and out on the way down was pure gambling and had nothing to do with the "secret" strategy...

I've bought back in twice since I sold a little over a week ago. Both on down days. I've sold within 24 hours each time for 2-3% gains. Finding ways to grow my capital even as the market burns down.

This is getting worse before it gets better. Hundreds of thousands are likely already dead, and hundreds of thousands will probably die here in the USA. Be mindful that this will not be a V-Shaped recovery when committing cash to equities long term.
« Last Edit: November 09, 2021, 03:17:10 PM by Davnasty »

ExitViaTheCashRamp

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Re: Welp, I'm going to take a stab at timing the market
« Reply #772 on: November 10, 2021, 06:41:25 AM »
It's not so much a V shaped recovery though, Chuck was right.

 It's more like the March 2020 top is base camp and here in Nov 2021 we are so high in the mountains that clouds are all around us.

MissNancyPryor

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Re: Welp, I'm going to take a stab at timing the market
« Reply #773 on: November 10, 2021, 08:32:07 AM »
Both Chuck and junioroldtimer have created an excellent lesson with this thread.  Too bad they are not around to speak about what they learned, but as I said folks don't like to talk about their losses. 

JoT accused people of rooting for him to lose in the early pages.  To be fair they probably were as they dashed off a posting-to-follow 'good luck' message and popped some corn.  I was glad that JoT was being public about it and it stinks that he didn't follow through.  Maybe he is hanging around with the "I made $900K in bitcoin" guy these days and will come back with a splash. 

I know someone who lost $700K by jumping out in March 2020.  Their account is high now so they are feeling good, but they have no idea that instead of 1.2M they would have 1.9M had they just calmed their shit down and waited it out.  Too clever by half, they are completely oblivious to what could have been.  They don't see themselves on the pages of this thread and still think they made an excellent financial decision when they panicked.  They lie to themselves and say it was not panic, it was wise and clever and strategic.  And they will do the same thing again during the next big drop. 

The Top Is In.