EvrClrx311
Full time employment: Posting here.
- Joined
- Feb 8, 2012
- Messages
- 648
Everywhere you see warnings about this... here's my story:
I'm back to where I started in February of this year. But this year has been more stressful because of an experiment of sorts, where I decided to see how trying to time the markets would go...
Here's my story in a nutshell, shared because I tend to learn so much from reading others ...
In early February, when COVID news was just starting to break in China but there wasn't a case in the US (found at least) yet... I used that as a trigger to step out of the market. I watched the bull for the previous decade and kept wondering when the drop would happen... I guess I felt it coming. I was lucky. I managed to pull 50% of my stock investments (into treasuries) when the DOW was at 29,200ish, a few days before everything fell. I watched the DOW drop to below 20K. I bought back in 25% of what I sold when it was at 19,500, and the rest when it was close to the bottom in March. I felt pretty good about this (it was luck though... I guess it's human emotions to tell yourself skill had something to do with it, you can do it again right)
Anyway... I watched the market tick upwards. and when it got to 22,500 I sold 50% again (this time to cash, money market) thinking this was a dead cat bounce. No way the market would EVER return to near it's Jan highs with COVID ravaging the global and US economies (still seems incredible to me now, that the market is where it is despite the roadmap behind us...) I sold the other half (also to cash) when it reached 24,000... and it's been difficult watching it continue to climb sitting on the sideline... I can say that missing gains (after abandoning your AA plan) is more painful than sitting in losses. At least for me it has been...
Yesterday (by my math) my account's value reached exactly what it would be if I had never touched it... that is, I've lost all the gains I received from timing that drop, by sitting in cash and seeing the market climb to where it is now (close to 30K). I guess it was a bit of a relief... I put it all back in, at the same asset allocation I was back in February. A relief that essentially nothing changed... except a lot of stress getting here, and a higher blood pressure I'm sure. It's not worth it.
I always read, don't try to time the markets... now I really understand it. Never again. I'm fortunate I can share this story of this experience (the last 6 months I've watched the market ever single day - something I never did in the last 15 years of investing to build my retirement) and still come out the other side, essentially back at square one. Regardless of what the market does moving forward.
It is much more comfortable to sit in your plan with faith in it... focused on the long term, and not the day to day (month to month) jitters, and trying to time them. I'm not sure how day traders do this. It would send me to an early grave.
I'm back to where I started in February of this year. But this year has been more stressful because of an experiment of sorts, where I decided to see how trying to time the markets would go...
Here's my story in a nutshell, shared because I tend to learn so much from reading others ...
In early February, when COVID news was just starting to break in China but there wasn't a case in the US (found at least) yet... I used that as a trigger to step out of the market. I watched the bull for the previous decade and kept wondering when the drop would happen... I guess I felt it coming. I was lucky. I managed to pull 50% of my stock investments (into treasuries) when the DOW was at 29,200ish, a few days before everything fell. I watched the DOW drop to below 20K. I bought back in 25% of what I sold when it was at 19,500, and the rest when it was close to the bottom in March. I felt pretty good about this (it was luck though... I guess it's human emotions to tell yourself skill had something to do with it, you can do it again right)
Anyway... I watched the market tick upwards. and when it got to 22,500 I sold 50% again (this time to cash, money market) thinking this was a dead cat bounce. No way the market would EVER return to near it's Jan highs with COVID ravaging the global and US economies (still seems incredible to me now, that the market is where it is despite the roadmap behind us...) I sold the other half (also to cash) when it reached 24,000... and it's been difficult watching it continue to climb sitting on the sideline... I can say that missing gains (after abandoning your AA plan) is more painful than sitting in losses. At least for me it has been...
Yesterday (by my math) my account's value reached exactly what it would be if I had never touched it... that is, I've lost all the gains I received from timing that drop, by sitting in cash and seeing the market climb to where it is now (close to 30K). I guess it was a bit of a relief... I put it all back in, at the same asset allocation I was back in February. A relief that essentially nothing changed... except a lot of stress getting here, and a higher blood pressure I'm sure. It's not worth it.
I always read, don't try to time the markets... now I really understand it. Never again. I'm fortunate I can share this story of this experience (the last 6 months I've watched the market ever single day - something I never did in the last 15 years of investing to build my retirement) and still come out the other side, essentially back at square one. Regardless of what the market does moving forward.
It is much more comfortable to sit in your plan with faith in it... focused on the long term, and not the day to day (month to month) jitters, and trying to time them. I'm not sure how day traders do this. It would send me to an early grave.
Last edited: