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I wonder how buying high and selling low (the strategy of S&P 500 holders) will work out in this new COVID era.
by cracker_jacks 6y ago
I wonder how buying high and selling low (the strategy of S&P 500 holders) will work out in this new COVID era.
- david-gpu 6y agoWhat makes you think that SP500 index funds, which are cap-weighted, amount to buying high and selling low?
- cracker_jacks 6y agoCompanies leave the index when they fall below a certain market cap. Companies enter the index when they are above a certain market cap. That is literally the definition of buying high and selling low.
- david-gpu 6y agoThe turnover rate is low and the weight of those companies in the index is very small. That said, I prefer broader indices.