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bank5 · 03-28-2009, 11:03 AM

I'm going to set up an automatic transfer from my checking account into my IRA. Is there a certain day of the week / month that is better to buy on? It probably doesn't make a big difference but I wonder what the historical data shows.

DblDoc · 03-28-2009, 01:00 PM

I read somewhere that any day that ends in the letter "Y".

The reasons given were twofold. One there was no evidence that any such advantage existed and secondly if it did it would be quickly exploited ( a' la EMH) and would thus disappear.

DD

bank5 · 03-28-2009, 01:15 PM

Quote:

Originally Posted by DblDoc

I read somewhere that any day that ends in the letter "Y".

The reasons given were twofold. One there was no evidence that any such advantage existed and secondly if it did it would be quickly exploited ( a' la EMH) and would thus disappear.

DD

That's what I figured. However, it's interesting looking at historical data like this - The Tech Farm: Historical Best Day of Month To Invest or Dollar Cost Average in the S&P 500 from 1950 to 2007 I'm guessing it's just random but it's kind of surprising how much variation there is between the days.

audreyh1 · 03-28-2009, 01:41 PM

Personally, I think the 15th of the month is a better choice than the beginning or end. Mutual funds tend to do mark-ups at the end of the month (especially the end of the quarter). Also lot of pension funds etc. have contributions come in the first of the month/quarter/year and you can see often see appreciation effects from that. The beginning of this year was a good example.

This is all anecdotal of course.

I do my annual rebalancing on Jan 15th. In most years after the first week there is a bit of a sell-off after the end of the prior year (but not always!!!!). I also check my fund balancing on the 15th of the first month of every quarter and if my AA is way out of balance I rebalance on the 15th.

Audrey

charlie · 03-29-2009, 10:26 AM

Way back in the late 80's before I realized that frequent trading of
individual stocks was a bad strategy (for me), I wrote down a list
of rules for stock trades that I pilfered from AAII:

1) Buy 2-3 days before the last trading day of the month.

2) Buy 2 days before a holliday that causes the market to be closed.

3) Sell toward the end of the 1st 9 trading days in the month.

4) Sell 3-4 days after 1st trading day of the month.

5) Don't sell near a holliday date. Stay at least 5 days away from it.

6) Buy on Tuesday, sell on Friday.

Take these with a large dose of salt.

Cheers,

charlie

CuppaJoe · 03-29-2009, 11:10 AM

To quote a scene from "M*A*S*H," "what time is it?"

In real life I'm more likely to buy or sell mid-month. The last time I sold mid-month, so many other people had the same idea that the market dropped. So for a while I thought maybe that was a better day to buy. But in retrospect it was a very good day to sell.

I'm planning to buy in mid-April by moving some fixed income money into equities.

ziggy29 · 03-29-2009, 11:29 AM

The worst days to buy are whenever my 401K contributions get invested.

crazy connie · 03-29-2009, 03:51 PM

Perhaps just put the money into a money market account and wait for a down day to purchase. Were I still investing new money that would be my plan.

mickeyd · 03-29-2009, 03:58 PM

I can't imagine that it makes a bit of difference in the long run. Spin a wheel, flip a coin, confer with a mystic if you will, but never pick the 30th or 31st.

Dennis · 03-29-2009, 04:32 PM

here's another..When the Market Goes down on a Friday, so the odds are it will also do so on Monday..
And DCA ing doesn't work either..
Let it build up in your MMkt.
Buy on the Dips,but wait for the 2nd and following one's, not the first..
Those that DCA'd in 00-01 kept loosing and loosing and loosing
same for 2008...
And Pro's Keep a min. of 10% in reserves to buy during Bull Markets and 15-20% for Bear markets..
I kept 30% out for 08' and again for this yr.. bought fist week of March with 50% of it. But, I've only done about 8% APy with my Retirement port since 98' to 08'.