Market Timing

[RetiredAt49]

I apologize in advance if the below copy/paste is unreadable. Please bring back the mobile app!

“ The S&P 500 is up 14% this year, but just eight days that explain most of the gains.”
“ Here's a hypothetical example of an investment in the S&P 500 over 50 years.
(through August 2019)
Total return******************************** $138,908
Minus the best performing day $124,491
Minus the best 5 days*************** $90,171
Minus the best 15 days************ $52,246
Minus the best 25 days************ $32,763”

https://stocks.apple.com/ACaouUinTQK23XO460My_Xw

 

[DrRoy]

+1

 

[VanWinkle]

My crystal ball shows more "best" days are coming, but it fogs up when I ask it to show when they will occur. I guess buy and hold lives on!!

 

[flyingaway]

You need to know when the best days are coming and act BEFORE those days.

 

[Lsbcal]

Totally useless information and self serving. The guy who wrote this article has a book linked in the article. Just a sales promo.

What about a strategy that gets you out on the worst performing days?

This part of the forum is not a place to post anti-active investing religion.

 

[retire48in2018]

Curious how this would be if you removed the worst 5 days, etc!

 

[Lsbcal]

Curious how this would be if you removed the worst 5 days, etc!

One can play all kinds of games with best/worst days and time periods. Turns out that some of the worst days were clustered in with some of the best days. This would be the case if there were excessive volatility due to market/world events.

Here is a short list of some worst and best days. Note how some best days come near some worst days:

 

[target2019]

It's probably click bait. But I suppose it's worth a thread now and then. 2022 was a year to be out of the market?

 

[Gumby]

....

This part of the forum is not a place to post anti-active investing religion.

Quite correct. OP, please read this post https://www.early-retirement.org/forums/f44/refocusing-the-forum-read-before-posting-110405.html

 

[RetiredAt49]

Quite correct. OP, please read this post https://www.early-retirement.org/forums/f44/refocusing-the-forum-read-before-posting-110405.html

Duly noted… I had no idea this sub-forum was specifically for non passive investing threads. Then again, people here didn’t like my thread on day trading either (which does fall into this category) so *

 

[Lsbcal]

Duly noted… I had no idea this sub-forum was specifically for non passive investing threads. Then again, people here didn’t like my thread on day trading either (which does fall into this category) so *

Forgot about that thread. I don't really think it was the case that people didn't like that thread. I was interested. It was short on specifics but that was OK since most of us here are not going to do highly analytical programming methods.

My own methods just involve modest trend following using Excel spreadsheets and as few trades as possible. Still I think nobody here is really interested in going even that far with data.

 

[yakers]

doesn't AI tell you the best/worst days to invest?

 

[Bdarr]

Market timing in an often irrational market is a dangerous game. But portfolio allocation is not quiet as hard. Is risk high? Is inflation an issue? Is greed high? Is fear high? How does market look based on the past using the Buffett indicator and CAPE valuation? To go all in or out is more than likely a losing proposition. Ben Graham proposed the principle of having no more that 75% in the stock market/businesses and no less than 25%. But for many who are accumulating retirement money dollar cost averaging is the best way and ignore the markets ups and downs. But near or in retirement the situation is different if you need money from your investments. So think carefully or get advisement from a competent person. A good rule of thumb is 3 yrs of safe investments to cover your needs is very wise. but it is a personal choice. The decisions you make will have outcomes that maybe great, good, so so or bad.

 

[MarieIG]

Forgot about that thread. I don't really think it was the case that people didn't like that thread. I was interested. It was short on specifics but that was OK since most of us here are not going to do highly analytical programming methods.

My own methods just involve modest trend following using Excel spreadsheets and as few trades as possible. Still I think nobody here is really interested in going even that far with data.

I liked OP's thread too . . .

 

[Qs Laptop]

This part of the forum is not a place to post anti-active investing religion.

Quite correct. OP, please read this post https://www.early-retirement.org/forums/f44/refocusing-the-forum-read-before-posting-110405.html

Well, I'm confused. It seems the point of the OP's post was to tell people to stay in the market. Don't try to time it by taking out your money. How is this "anti-active investment religion?"

Also, if not this subforum, which one would be appropriate?

 

[Lsbcal]

Well, I'm confused. It seems the point of the OP's post was to tell people to stay in the market. Don't try to time it by taking out your money. How is this "anti-active investment religion?"

Also, if not this subforum, which one would be appropriate?

Active investing can involve market timing.

The linked article was titled "Why market timing does not work ....". That is just not in keeping with this intent of this subforum. I think a better subforum would be "Fire and Money".