My mistake has led to timing the market perfectly.

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17outs
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My mistake has led to timing the market perfectly.

Post by 17outs »

So I was changing the investments of my 401k essentially switching from TDF to the same thing but in 4 funds. I forgot to make the trade for 20% of 401k a couple weeks so it was sitting in cash this whole time. For once an accident that saved me money! Now the harder question...would you wait a couple more days of this corona hell and see if it drops further or would you just allocate the orders like any other long term? Time horizon is 30 years.
Walkure
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Re: My mistake has led to timing the market perfectly.

Post by Walkure »

Just allocate the orders, lock-in that missed correction, and stay the course. Don't get greedy.
Topic Author
17outs
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Re: My mistake has led to timing the market perfectly.

Post by 17outs »

Thanks for your confirmation. I was leaning this way.
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sometimesinvestor
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Re: My mistake has led to timing the market perfectly.

Post by sometimesinvestor »

Plan to buy on Tuesday . If I am wrong I am sorry but apparently the data shows markets do not bottom on friday. A critical issue is the number of new virus cases and why the person who caught the disease in california did so. It is possible the weekend will reveal all.
mega317
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Re: My mistake has led to timing the market perfectly.

Post by mega317 »

Same issue for me. It takes a little arm twisting to get my wife, who is not interested at all, to log in to her accounts. So she logged in to contribute to her tIRA. She logged in again to convert to Roth. But we have not logged in a third time to buy VTSAX. Oops!
https://www.bogleheads.org/forum/viewtopic.php?t=6212
mega317
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Re: My mistake has led to timing the market perfectly.

Post by mega317 »

Also, what if stocks drop more? Hard to call your timing perfect. Good illustration of why it's so hard to time the market--you have to be right twice.
https://www.bogleheads.org/forum/viewtopic.php?t=6212
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Stinky
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Re: My mistake has led to timing the market perfectly.

Post by Stinky »

Walkure wrote: Fri Feb 28, 2020 2:12 pm Just allocate the orders, lock-in that missed correction, and stay the course. Don't get greedy.
+1.

Don’t get greedy.

Congratulations on your good fortune
It's a GREAT day to be alive! - Travis Tritt
stocknoob4111
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Re: My mistake has led to timing the market perfectly.

Post by stocknoob4111 »

17outs wrote: Fri Feb 28, 2020 1:59 pm So I was changing the investments of my 401k essentially switching from TDF to the same thing but in 4 funds. I forgot to make the trade for 20% of 401k a couple weeks so it was sitting in cash this whole time. For once an accident that saved me money! Now the harder question...would you wait a couple more days of this corona hell and see if it drops further or would you just allocate the orders like any other long term? Time horizon is 30 years.
I think you just missed the bottom, stocks are skyrocketing after hours! We may see a massive 5%+ rally on Monday.
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JoeRetire
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Re: My mistake has led to timing the market perfectly.

Post by JoeRetire »

17outs wrote: Fri Feb 28, 2020 1:59 pmNow the harder question...would you wait a couple more days of this corona hell and see if it drops further or would you just allocate the orders like any other long term? Time horizon is 30 years.
If every instinct you have is wrong, then the opposite would have to be right.

So what do your instincts tell you?
It's the end of the world as we know it. | It's the end of the world as we know it. | It's the end of the world as we know it. | And I feel fine.
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JoeRetire
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Re: My mistake has led to timing the market perfectly.

Post by JoeRetire »

stocknoob4111 wrote: Fri Feb 28, 2020 4:23 pmWe may see a massive 5%+ rally on Monday.
Or not.
It's the end of the world as we know it. | It's the end of the world as we know it. | It's the end of the world as we know it. | And I feel fine.
bltn
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Re: My mistake has led to timing the market perfectly.

Post by bltn »

One of my former business partners used to have a saying, "I d rather be lucky than good". (He made his own luck.)

I d put the money in Monday.
yules
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Re: My mistake has led to timing the market perfectly.

Post by yules »

mega317 wrote: Fri Feb 28, 2020 3:27 pm Also, what if stocks drop more? Hard to call your timing perfect. Good illustration of why it's so hard to time the market--you have to be right twice.
I read this statement all the time on Bogleheads, and I think it's wrong. You only have to be right once. OP was right (lucky) once in selling stocks and has some gains. OP doesn't need to be right ***again*** by buying at the very bottom to make money. Just transfer it back to the intended allocation ASAP and OP is better off than OP would have been.

I'm not saying that people should try to time the market and I get that the statement is to discourage active trading, and timing the market, but I think it is incorrect.

Yules
Caduceus
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Re: My mistake has led to timing the market perfectly.

Post by Caduceus »

yules wrote: Fri Feb 28, 2020 10:22 pm
mega317 wrote: Fri Feb 28, 2020 3:27 pm Also, what if stocks drop more? Hard to call your timing perfect. Good illustration of why it's so hard to time the market--you have to be right twice.
I read this statement all the time on Bogleheads, and I think it's wrong. You only have to be right once. OP was right (lucky) once in selling stocks and has some gains. OP doesn't need to be right ***again*** by buying at the very bottom to make money. Just transfer it back to the intended allocation ASAP and OP is better off than OP would have been.

I'm not saying that people should try to time the market and I get that the statement is to discourage active trading, and timing the market, but I think it is incorrect.

Yules
Yes, but many people don't do that. If OP waits and waits and waits for some severe market downturn, and let's say it doesn't turn up and the market shoots up, he might buy back at a higher cost basis, and then he'd have made a loss compared to his original position.
Ronocnayr
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Re: My mistake has led to timing the market perfectly.

Post by Ronocnayr »

stocknoob4111 wrote: Fri Feb 28, 2020 4:23 pm
17outs wrote: Fri Feb 28, 2020 1:59 pm So I was changing the investments of my 401k essentially switching from TDF to the same thing but in 4 funds. I forgot to make the trade for 20% of 401k a couple weeks so it was sitting in cash this whole time. For once an accident that saved me money! Now the harder question...would you wait a couple more days of this corona hell and see if it drops further or would you just allocate the orders like any other long term? Time horizon is 30 years.
I think you just missed the bottom, stocks are skyrocketing after hours! We may see a massive 5%+ rally on Monday.
I think it was Baron Rothschild who said, "I made my fortune by selling too early" - The bottom may be in, probably not, but either way getting in now is probably reasonable - even if you got in too late! 8-)
NMBob
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Re: My mistake has led to timing the market perfectly.

Post by NMBob »

how about putting half in on monday, and then perhaps a quarter in 3 weeks, and a quarter in 6-12 weeks.
VaR
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Re: My mistake has led to timing the market perfectly.

Post by VaR »

It's a good time to double-check on your risk tolerance and appropriate asset allocation. Once you've confirmed it, which running through your head your current fears vs the euphoria that you and most investors felt a couple of weeks ago, you can revisit your IPS and figure out what rebalancing strategy you would like to use.

Bottom line: I think it's valid to either use your rebalancing strategy or to get right back into your target asset allocation after a mistake like this. The mistake just means that you missed out on five days of equity losses and fixed income gains. It shouldn't have affected your asset allocation target.
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willthrill81
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Re: My mistake has led to timing the market perfectly.

Post by willthrill81 »

stocknoob4111 wrote: Fri Feb 28, 2020 4:23 pm
17outs wrote: Fri Feb 28, 2020 1:59 pm So I was changing the investments of my 401k essentially switching from TDF to the same thing but in 4 funds. I forgot to make the trade for 20% of 401k a couple weeks so it was sitting in cash this whole time. For once an accident that saved me money! Now the harder question...would you wait a couple more days of this corona hell and see if it drops further or would you just allocate the orders like any other long term? Time horizon is 30 years.
I think you just missed the bottom, stocks are skyrocketing after hours! We may see a massive 5%+ rally on Monday.
We might. We might also see a continuance of the declines of the last six trading days. Considering that the number of U.S. cases is increasing quickly, and there's now been a U.S. death from Covid-19, the latter seems more likely to me.
“It's a dangerous business, Frodo, going out your door. You step onto the road, and if you don't keep your feet, there's no knowing where you might be swept off to.” J.R.R. Tolkien,The Lord of the Rings
NMBob
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Re: My mistake has led to timing the market perfectly.

Post by NMBob »

willthrill81 wrote: Sat Feb 29, 2020 4:31 pm
stocknoob4111 wrote: Fri Feb 28, 2020 4:23 pm
17outs wrote: Fri Feb 28, 2020 1:59 pm So I was changing the investments of my 401k essentially switching from TDF to the same thing but in 4 funds. I forgot to make the trade for 20% of 401k a couple weeks so it was sitting in cash this whole time. For once an accident that saved me money! Now the harder question...would you wait a couple more days of this corona hell and see if it drops further or would you just allocate the orders like any other long term? Time horizon is 30 years.
I think you just missed the bottom, stocks are skyrocketing after hours! We may see a massive 5%+ rally on Monday.
We might. We might also see a continuance of the declines of the last six trading days. Considering that the number of U.S. cases is increasing quickly, and there's now been a U.S. death from Covid-19, the latter seems more likely to me.
yep
https://www.cnbc.com/2020/03/01/awaitin ... -2008.html

and now futures that were down are now up , even apparently with the news of new york cases.......
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nps
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Re: My mistake has led to timing the market perfectly.

Post by nps »

willthrill81 wrote: Sat Feb 29, 2020 4:31 pm
stocknoob4111 wrote: Fri Feb 28, 2020 4:23 pm
17outs wrote: Fri Feb 28, 2020 1:59 pm So I was changing the investments of my 401k essentially switching from TDF to the same thing but in 4 funds. I forgot to make the trade for 20% of 401k a couple weeks so it was sitting in cash this whole time. For once an accident that saved me money! Now the harder question...would you wait a couple more days of this corona hell and see if it drops further or would you just allocate the orders like any other long term? Time horizon is 30 years.
I think you just missed the bottom, stocks are skyrocketing after hours! We may see a massive 5%+ rally on Monday.
We might. We might also see a continuance of the declines of the last six trading days. Considering that the number of U.S. cases is increasing quickly, and there's now been a U.S. death from Covid-19, the latter seems more likely to me.
As we now know the S&P 500 gained 136 points (4.6%) for the day. And nearly 60 of those points came after the press conference that announced that the US death toll had rapidly risen to 6.

I didn't know what seemed likely for today and I also don't know what seems likely for tomorrow. Fortunately it doesn't affect my investment plans either way.
Topic Author
17outs
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Re: My mistake has led to timing the market perfectly.

Post by 17outs »

Alas, it dropped 3% today. It was fun while it lasted.
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