4 ms·
If you cut early and miss the top 5% of profits then buy back in at 5% above the bottom when it rebounds you'll do pretty well.
by richliss 4y ago
If you cut early and miss the top 5% of profits then buy back in at 5% above the bottom when it rebounds you'll do pretty well.
- pzs 4y agoThat sounds great in theory, but you can't implement it in practice. It's often easy in hindsight to identify where are those suboptimal 5%-away-from-perfect-timing points where you should have done a rebalancing, but we have no idea how close we are to the next peak/trough.
- opportune 4y agoIt was very easy to identify as it happened, when inflation hit 8% while rates were at 0% and unemployment was at like 4%.
- UncleMeat 4y agoYou also have to get back in at the right time. A lot of people called that the market would drop in March 2020. But how many realized that by August, long before vaccines were in sight, that the market wouldn't go below the pre-covid peak again? Somebody who sells in March and then buys in October loses a lot.
- throw0101c 4y agoIf you try to miss the bad/worst days you'll probably miss the best days: * https://theirrelevantinvestor.com/2019/02/08/miss-the-worst-days-miss-the-best-days/ https://theirrelevantinvestor.com/2019/02/08/miss-the-worst-... * https://aaiila.org/wp-content/uploads/2020/05/Tuchman-Best-and-Worst-Days.pdf https://aaiila.org/wp-content/uploads/2020/05/Tuchman-Best-a... * https://www.capitalgroup.com/individual/planning/investing-fundamentals/time-not-timing-is-what-matters.html https://www.capitalgroup.com/individual/planning/investing-f... * https://www.cnbc.com/2021/03/24/this-chart-shows-why-investors-should-never-try-to-time-the-stock-market.html https://www.cnbc.com/2021/03/24/this-chart-shows-why-investo...