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>" It's NOT at all averaged out in the way the Bogleheads might think it is." Correct. There are smart people doing research out there right now demonstrating

>" It's NOT at all averaged out in the way the Bogleheads might think it is." Correct. There are smart people doing research out there right now demonstrating that "passive" isn't really passive, and that people regularly buying into indices at any price is skewing the market. No one is clear on what the ramifications of this are, but as the old adage says, "past performance no guarantee of future success". The same goes for buying the SPY and forgetting about it.

throw0101a 6y ago
> […] and that people regularly buying into indices at any price is skewing the market. And at what price should people be investing in the market? Sitting on the side in cash, waiting for the dips and crashes to occur, will give you mediocre results: * https://ofdollarsanddata.com/even-god-couldnt-beat-dollar-cost-averaging/ https://ofdollarsanddata.com/even-god-couldnt-beat-dollar-co... Further, trying to miss the worst days on market down turns often means missing the days with the best returns: * https://theirrelevantinvestor.com/2019/02/08/miss-the-worst-days-miss-the-best-days/ https://theirrelevantinvestor.com/2019/02/08/miss-the-worst-... For most people, most of the time, the best thing they can do is just chug along putting a little bit of money away every month. Put in what you can, but a good goal (if you can afford it) is to put away at least 5% of your income (and maybe up to 10%). > The same goes for buying the SPY and forgetting about it. You're not wrong, but: what's the alternative? Unless you can show something that's demonstratively better than a low-fee S&P 500 or Russell 3000 index fund (perhaps tempered with some bonds for risk/volatility management), bemoaning the situation is not very productive.
kokey 6y ago
I'm also an index fund skeptic mainly because it's now such a convention that taxi drivers and shoeshine boys will tell you that's where you should put your money. People used to say the same things about investing in real estate and many other things and for a time in history those things were demonstrably the best investment long term, until it wasn't. It looks like now is that time again for the stock market to look good. It still doesn't mean it's a bad investment either and no one will blame you if you suffer with everyone else when it goes wrong. However, it's also never worth putting all your money into unless you can afford to ride through a slump that could last well over a decade.

throw0101a 6y ago

> […] and that people regularly buying into indices at any price is skewing the market. And at what price should people be investing in the market? Sitting on the side in cash, waiting for the dips and crashes to occur, will give you mediocre results: * https://ofdollarsanddata.com/even-god-couldnt-beat-dollar-cost-averaging/ https://ofdollarsanddata.com/even-god-couldnt-beat-dollar-co... Further, trying to miss the worst days on market down turns often means missing the days with the best returns: * https://theirrelevantinvestor.com/2019/02/08/miss-the-worst-days-miss-the-best-days/ https://theirrelevantinvestor.com/2019/02/08/miss-the-worst-... For most people, most of the time, the best thing they can do is just chug along putting a little bit of money away every month. Put in what you can, but a good goal (if you can afford it) is to put away at least 5% of your income (and maybe up to 10%). > The same goes for buying the SPY and forgetting about it. You're not wrong, but: what's the alternative? Unless you can show something that's demonstratively better than a low-fee S&P 500 or Russell 3000 index fund (perhaps tempered with some bonds for risk/volatility management), bemoaning the situation is not very productive.

kokey 6y ago

I'm also an index fund skeptic mainly because it's now such a convention that taxi drivers and shoeshine boys will tell you that's where you should put your money. People used to say the same things about investing in real estate and many other things and for a time in history those things were demonstrably the best investment long term, until it wasn't. It looks like now is that time again for the stock market to look good. It still doesn't mean it's a bad investment either and no one will blame you if you suffer with everyone else when it goes wrong. However, it's also never worth putting all your money into unless you can afford to ride through a slump that could last well over a decade.