tangomonster
Full time employment: Posting here.
- Joined
- Mar 20, 2006
- Messages
- 757
The latest issue of Newsweek says that it may be wise to sell stocks after this spring's run-up because "stocks often tumble as the temperature rises--big money from December dividends, year-end bonuses, and April IRA contributions have already made it into the market."
According to the research (They're quoting from Ned Davis Research), if you'd put $10,000 into the S & P on May 1st, 1950, selling every May1st and buying in October, you'd have more than $600,000. If you'd done the opposite and invested every May 1st and sold every September 1st, you'd have $12,083. If you had just let it ride in a buy-and-hold strategy, you would have $129,515.
DH and I have always tried to buy and hold, feeling that we wouldn't be successful in timing (greater minds than ours have failed in this), but even before I read this article I've been thinking that it could be good to sell (not everything, but the net gain) take the tax bite, and reinvest in tax-free stuff. Any opinions on this? And does anyone know if it's true that $10,000 in the S and P in 1950 would have grown to "only" $129,000?
According to the research (They're quoting from Ned Davis Research), if you'd put $10,000 into the S & P on May 1st, 1950, selling every May1st and buying in October, you'd have more than $600,000. If you'd done the opposite and invested every May 1st and sold every September 1st, you'd have $12,083. If you had just let it ride in a buy-and-hold strategy, you would have $129,515.
DH and I have always tried to buy and hold, feeling that we wouldn't be successful in timing (greater minds than ours have failed in this), but even before I read this article I've been thinking that it could be good to sell (not everything, but the net gain) take the tax bite, and reinvest in tax-free stuff. Any opinions on this? And does anyone know if it's true that $10,000 in the S and P in 1950 would have grown to "only" $129,000?