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I remember in 98 a lot of investment managers said we're in a bubble and went conservative. They missed out of a lot of upside and many got fired. Nobody knows
by rb808 7y ago
I remember in 98 a lot of investment managers said we're in a bubble and went conservative. They missed out of a lot of upside and many got fired. Nobody knows whats going to happen this year, probably depends mostly on the election.
- JKCalhoun 7y agoThat is my frustration: I've been too conservative too early and missed a chunk of the rally. Only a manager of my own investments so not likely to be fired. ;-)
- ilikehurdles 7y agoIf you had been too conservative for all 2018 you'd also have missed out on the few down days that eliminated all gains that year. So even if you sat out for a year due to your imprecise prediction, you'd have come out ahead of others who owned stocks. Problem is predicting which 8-12 month period the down days will happen. Seems like it should be reasonable to able to do that, but predictions of weather patterns over the same time range seem more accurate.
- Scoundreller 7y agoOver time, there have been a lot more up days than bad days, but the bad days are really bad. I remember somewhere that tabulated how much you’d have if you only sat in on the top 100 UP days and top 100 DOWN days, you’d have massive losses. But overall, things go up. So sitting out the market in hopes of missing a down day only works if you know what the down days are, otherwise you’re missing out on the gradual average UP days.
- Shaanie 7y agoUsually known as "time in the market beats timing the market."
- Scoundreller 7y agoI like that. It bothers me when people say “I have $5k, and I’ll invest $1k of it every month for 5 months to average my ins”.