Unwinding all positions and buy back after French Elections

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youcha
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Unwinding all positions and buy back after French Elections

Post by youcha » Tue Apr 18, 2017 6:06 am

Hi All,

I was wondering, why should anyone run the risk of the impact of politicals risks when holding a portfolio?
Given the low cost of investing ( in & out in your favorite low cost broker should run around ~7bps of your portfolio size or so), don't you think it's a good a idea to close all positions before the elections and buy back right after?

I know it's not really buy & hold.... But there is one event there that could break the Eurozone and trigger some bear markets (nice buying opportunities). On the other hand if things go smoothly, global market won't rally 10% up to celebrate...

What do you think?

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Re: Unwinding all positions and buy back after French Elections

Post by jebmke » Tue Apr 18, 2017 6:19 am

youcha wrote:But there is one event there that could break the Eurozone and trigger some bear markets
like Greek default .... or Brexit .....?
When you discover that you are riding a dead horse, the best strategy is to dismount.

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Re: Unwinding all positions and buy back after French Elections

Post by youcha » Tue Apr 18, 2017 6:24 am

yes =)
That's the very reason I think it's a good trade.

What we saw in those two examples was that the market stumbled and came back to pre-news levels. I am not saying you will be the one buying at the bottom of course...

But even if you get back in the market @ the same levels you got out, you basically payed 7bps to protect yourself against a major collapse of your portfolio. Sounds cheap for an insurance. The edge you have in political-driven events is that you currently know when to get out & in

Obviously I am new to investing so you can feel I am still doubting the buy and hold a lot :? But I think the question is worth being asked.

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Re: Unwinding all positions and buy back after French Elections

Post by awval999 » Tue Apr 18, 2017 6:35 am

For one, the answer is of course not.

You just have to turn out the noise. I guarantee you can you can search and find a thread about the US Presidential election just like this one. That person would be out 20% in growth.

Don't let the news media or your own personal politics change your investing choices.

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Re: Unwinding all positions and buy back after French Elections

Post by nisiprius » Tue Apr 18, 2017 6:39 am

Here's why I think it's a bad idea.

When thinking about bad scenarios that we'd like to protect ourselves against, we focus on one bad possibility that for some reason captures our horrified attention, and we work out a storyline in detail. This is what enabled insurance companies to sell crappy "dread-disease" insurance that only protects against diseases that truly horrify us. They were cheap because in reality that full range of expensive diseases is much, much bigger than the short list of the one or two that horrify us.

For some reason, you see the French elections as an obvious "political risk" that you can dodge. But in reality, if you start paying attention, you'll realize that the French elections just happen to be in the news, and there are geopolitical risks happening all the time, any one of which could blow up into a portfolio-destroyer. If you wait out the French election and you start paying attention you will soon be waiting out something every year. It's always something!

In order to get the "risk premium" you really do have to take the risk. Things like French elections are part of that risk. There's no magic formula for vastly reducing the risk of your stock market investments by simply avoiding short periods of obvious danger. If there were, everybody would do it and the stock market would not be risky and there would be no risk premium.

Elections are particularly bad because we become influenced by our own political views. We become convinced that if the candidate we oppose gets in, the world will go to hell in a handbasket. In reality, the response of the stock market to elections is just as unpredictable and surprising as its response to anything else.

Adjust your stock allocation down to the point where you can accept the risk, French elections and all.
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Re: Unwinding all positions and buy back after French Elections

Post by b42 » Tue Apr 18, 2017 6:42 am

Remember if you are market timing, you have to be right twice, getting out of the market and back into the market. Say you sell and the market does go down? How would you determine when to buy back, and what if you buy back and the downturn turns into a prolonged recession?

Most on the forums will recommend that you stay put and do nothing during the election.

However, a good test of this plan would be to list the funds that you would "sell" right before the election, and the anticipated trigger when to get back into the market (either a specific date or market price), and compare in a year to see how each method would have played out.

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Re: Unwinding all positions and buy back after French Elections

Post by abuss368 » Tue Apr 18, 2017 6:45 am

I would stay the course. In the last decade we have all witnessed the Greece crisis and Brexit.
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Re: Unwinding all positions and buy back after French Elections

Post by AlohaJoe » Tue Apr 18, 2017 6:45 am

youcha wrote:Given the low cost of investing ( in & out in your favorite low cost broker should run around ~7bps of your portfolio size or so)
Plus, how do you know markets won't rally?

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Re: Unwinding all positions and buy back after French Elections

Post by harvestbook » Tue Apr 18, 2017 6:50 am

Even if you knew the outcome today, what guarantee do you have the market will react in the way you think it "should"?
Plenty of folks think busting up the Eurozone would be a positive event or they wouldn't be supporting it. Even with perfect information, humans make a market, and they seem to become less rational by the day.

Besides, your capital gains tax obligation would survive a nuclear holocaust...
I'm not smart enough to know, and I can't afford to guess.

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Re: Unwinding all positions and buy back after French Elections

Post by bottlecap » Tue Apr 18, 2017 6:58 am

The only thing you need to protect yourself from is yourself.

Stuff like this comes up every few weeks in the news. If you worry about the 24 hour news cycle and make it a part of your investment strategy, not only will you and the journalists be wrong most of the time, but you won't be in the market for more than a few weeks a year.

"Obviously I am new to investing..."

"The edge you have in political-driven events is that you currently know when to get out & in."

These are incompatible statements. I suggest you write the first on the chalkboard 100 times!

JT

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Re: Unwinding all positions and buy back after French Elections

Post by nisiprius » Tue Apr 18, 2017 9:29 am

Here's why I think it's a fairly bad idea.

When thinking about bad scenarios that we'd like to protect ourselves against, we focus on one bad possibility that for some reason captures our horrified attention, and we work out a storyline in detail. This is what enabled insurance companies to sell crappy "dread-disease" insurance that only protects against diseases that truly horrify us. They were cheap because in reality that full range of expensive diseases is much, much bigger than the short list of the one or two that horrify us.

For some reason, you see the French elections as an obvious "political risk" that you can dodge. But in reality, if you start paying attention, you'll realize that the French elections just happen to be in the news, and there are geopolitical risks happening all the time, any one of which could blow up into a portfolio-destroyer. If you wait out the French election and you start paying attention you will soon be waiting out something every year. It's always something!

In order to get the "risk premium" you really do have to take the risk. Things like French elections are part of that risk. There's no magic formula for vastly reducing the risk of your stock market investments by simply avoiding short periods of obvious danger. If there were, everybody would do it and the stock market would not be risky and there would be no risk premium.

Elections are particularly bad because we become influenced by our own political views. We become convinced that if the candidate we oppose gets in, the world will go to hell in a handbasket. In reality, the response of the stock market to elections is just as unpredictable and surprising as its response to anything else.

Don't forget that timing is a problem, too. Bad person gets elected? Financial problems ensue? Even if you're right, the economic effects may not bite in for years. So once you've sold all your stocks in hope of dodging a bullet, you keep waiting and waiting and waiting for the bullet. That means that every decision to exit becomes a decision to stay out for years. The longer you stay out, the more fearful you become that the market will crash the day after you get in.

Adjust your stock allocation down to the point where you can accept the risk, French elections and all. Much better to hold 50% stocks all the time than 100% half the time and zero half the time.
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Re: Unwinding all positions and buy back after French Elections

Post by 22twain » Tue Apr 18, 2017 10:50 am

Even if I lived and invested in France, I wouldn't make any changes just because of the elections there. I'm in the US and I didn't make any changes because of the US election last fall.

I admit to feeling some tiny twitches when I saw that stock futures were waaaay down around midnight on election night. :shock: But the following day it was almost as if nothing had happened.
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Re: Unwinding all positions and buy back after French Elections

Post by WallStreetPhysician » Tue Apr 18, 2017 10:53 am

youcha wrote:Hi All,

I was wondering, why should anyone run the risk of the impact of politicals risks when holding a portfolio?
Given the low cost of investing ( in & out in your favorite low cost broker should run around ~7bps of your portfolio size or so), don't you think it's a good a idea to close all positions before the elections and buy back right after?

I know it's not really buy & hold.... But there is one event there that could break the Eurozone and trigger some bear markets (nice buying opportunities). On the other hand if things go smoothly, global market won't rally 10% up to celebrate...

What do you think?
Similar concerns were raised prior to the American election. Trump's election was supposed to be bad for the market, and the market has gone up since his election. I'd stay the course.

-WSP

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Re: Unwinding all positions and buy back after French Elections

Post by Ged » Tue Apr 18, 2017 11:19 am

youcha wrote:
Given the low cost of investing ( in & out in your favorite low cost broker should run around ~7bps of your portfolio size or so), don't you think it's a good a idea to close all positions before the elections and buy back right after?
Frequent trading costs add up over time. Many mutual funds have restrictions on that sort of activity.

It's only low cost if your entire portfolio is in tax deferred accounts. Otherwise it has some potentially quite unpleasant tax implications.

Furthermore history shows that over time markets generally go up. If you are out of the market when it rallies you will be buying back in at the higher prices. Because of the upward bias this is a more likely scenario than a market decline.

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Re: Unwinding all positions and buy back after French Elections

Post by AlohaJoe » Mon Apr 24, 2017 9:29 pm

youcha wrote:Hi All,

I was wondering, why should anyone run the risk of the impact of politicals risks when holding a portfolio?
Given the low cost of investing ( in & out in your favorite low cost broker should run around ~7bps of your portfolio size or so), don't you think it's a good a idea to close all positions before the elections and buy back right after?

I know it's not really buy & hold.... But there is one event there that could break the Eurozone and trigger some bear markets (nice buying opportunities). On the other hand if things go smoothly, global market won't rally 10% up to celebrate...

What do you think?
It is the day after the election (well...round 1 of the election but with Macron now the heavy favorite going into the runoff) and so far things have "gone smoothly" and markets did rally:

Image

So much for the theory that markets won't rally when things go smoothly....

(This is why most on Bogleheads don't recommend market timing because naive models of how the market "works" are always wrong.)

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Re: Unwinding all positions and buy back after French Elections

Post by Vanguard Fan 1367 » Mon Apr 24, 2017 9:43 pm

I have been hurt badly trying to time the market. Buy and hold index investing has rewarded me greatly.

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Re: Unwinding all positions and buy back after French Elections

Post by magicrat » Tue Apr 25, 2017 8:09 am

Interesting idea OP. If you undertake this please keep detailed records and let us know how you perform against an appropriate benchmark of equivalent risk.

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Re: Unwinding all positions and buy back after French Elections

Post by CurlyDave » Tue Apr 25, 2017 11:10 am

youcha wrote:yes =) ...But even if you get back in the market @ the same levels you got out, you basically payed 7bps to protect yourself against a major collapse of your portfolio. Sounds cheap for an insurance. The edge you have in political-driven events is that you currently know when to get out & in ...
Think about the US election. When the networks called it for Trump, the after hours market fell like a rock. I saw with my own eyes some commentator give the opinion that they would never recover.

By the time the markets opened the next morning we were in rally mode.

Your strategy would have netted a loss. There is no reason to believe you can get back in at the same level you sold out. The market goes up most of the time.

Buy and hold is the safe bet.

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Re: Unwinding all positions and buy back after French Elections

Post by michaeljc70 » Tue Apr 25, 2017 11:39 am

The title made me think this was click-bait on Bogleheads! :D

As has been pointed out, if the election result is favorable (to the markets) you will have lost out on that gain. As also pointed out, what you think might be the market reaction to a certain result isn't always. Where are you going to draw the line? Get out of the market before the Indian elections (India has a bigger economy than France)? Get out before Apple reports earnings? Get out before the unemployment or GDP numbers?

Then there is also taxes if you sold at a gain in a taxable account.....

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Re: Unwinding all positions and buy back after French Elections

Post by JoMoney » Tue Apr 25, 2017 11:50 am

People thought the U.S. election was going to bring chaos to the markets.... stocks have gone up 10%+ since, anybody that sold around then wouldn't have had an opportunity to buy back in anywhere near those levels (yet)
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Re: Unwinding all positions and buy back after French Elections

Post by TSR » Tue Apr 25, 2017 12:00 pm

CurlyDave wrote:
youcha wrote:yes =) ...But even if you get back in the market @ the same levels you got out, you basically payed 7bps to protect yourself against a major collapse of your portfolio. Sounds cheap for an insurance. The edge you have in political-driven events is that you currently know when to get out & in ...
Think about the US election. When the networks called it for Trump, the after hours market fell like a rock. I saw with my own eyes some commentator give the opinion that they would never recover.

By the time the markets opened the next morning we were in rally mode.

Your strategy would have netted a loss. There is no reason to believe you can get back in at the same level you sold out. The market goes up most of the time.

Buy and hold is the safe bet.
Agreed. I have certain political views that made me think that a Trump presidency would have created some of the greatest uncertainty the market has ever known. If I was a betting man, which I'm not, I would have made the same move you're considering, and I would have lost big. I say all of this not to start a political discussion, but to say that ALL such thoughts are informed by our own politics, and an overestimation of the "rightness" of those politics is inherent in any judgment about what to do -- it's another cognitive bias that will negatively affect your investment. That's why "nothing" is what you should do. As always, you could be proven right the day after the election, but don't confuse strategy with outcome.

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Re: Unwinding all positions and buy back after French Elections

Post by oldcomputerguy » Tue Apr 25, 2017 12:07 pm

youcha wrote:Hi All,

I was wondering, why should anyone run the risk of the impact of politicals risks when holding a portfolio?
Given the low cost of investing ( in & out in your favorite low cost broker should run around ~7bps of your portfolio size or so), don't you think it's a good a idea to close all positions before the elections and buy back right after?
Sure glad I didn't do that. The French market closed at a 9-year high the day after the election.

Don't try to time the market.
It’s taken me a lot of years, but I’ve come around to this: If you’re dumb, surround yourself with smart people. And if you’re smart, surround yourself with smart people who disagree with you.

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Re: Unwinding all positions and buy back after French Elections

Post by GoldenFinch » Tue Apr 25, 2017 12:07 pm

You have to ask yourself, "Am I investing? Or am I gambling?" The answer for me is "investing" because I don't have the risk tolerance to gamble. Just automate your investments and take the money out when you need to use it. If you need to use it soon, like next month, don't invest it. Good luck.

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Re: Unwinding all positions and buy back after French Elections

Post by jalbert » Tue Apr 25, 2017 12:29 pm

Over time, you can expect to win about half the time and lose about half the time when market timing based on predicting the outcome of future events. It thus does not improve expected return. But because you take the risk of losing more than you win, it increases risk. In mathematical terms, it increases variance of returns without increasing expected return. As a result, market timing lowers your expected risk-adjusted return.
Risk is not a guarantor of return.

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Re: Unwinding all positions and buy back after French Elections

Post by livesoft » Tue Apr 25, 2017 12:33 pm

jalbert wrote:Over time, you can expect to win about half the time and lose about half the time when market timing based on predicting the outcome of future events.
"half the time" ?? Do you have a link that supports this 50% statement please?
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Re: Unwinding all positions and buy back after French Elections

Post by michaeljc70 » Tue Apr 25, 2017 12:38 pm

livesoft wrote:
jalbert wrote:Over time, you can expect to win about half the time and lose about half the time when market timing based on predicting the outcome of future events.
"half the time" ?? Do you have a link that supports this 50% statement please?
There are still people that sold in 2009 and haven't got back into the market because it didn't seem like the "right" time!

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Re: Unwinding all positions and buy back after French Elections

Post by Gufomel » Tue Apr 25, 2017 1:18 pm

The Dow just passed 21k for the first time. Up about 500 or 2% since prior to the French election. Almost any stock fund would have seen similar results.

Hope you didn't "undwind".

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Re: Unwinding all positions and buy back after French Elections

Post by Jimmie » Tue Apr 25, 2017 1:32 pm

Gufomel wrote:The Dow just passed 21k for the first time.
Nope. On March 1, 2017 Dow hit the current closing record of 21,115.55 with an intraday high of 21,169.11.
Last edited by Jimmie on Tue Apr 25, 2017 1:33 pm, edited 1 time in total.

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Re: Unwinding all positions and buy back after French Elections

Post by Nicolas » Tue Apr 25, 2017 1:33 pm

Gufomel wrote:The Dow just passed 21k for the first time. Up about 500 or 2% since prior to the French election. Almost any stock fund would have seen similar results.

Hope you didn't "undwind".
It passed 21K for the first time at the beginning of March.

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Re: Unwinding all positions and buy back after French Elections

Post by Gufomel » Tue Apr 25, 2017 1:34 pm

Jimmie wrote:
Gufomel wrote:The Dow just passed 21k for the first time.
Nope. On March 1, 2017 Dow hit the current closing record of 21,115.55.
I stand corrected. Forgot about that.

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Re: Unwinding all positions and buy back after French Elections

Post by Vanguard Fan 1367 » Tue Apr 25, 2017 1:41 pm

I love Jack Bogle, "don't do something, just stand there." :happy

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Re: Unwinding all positions and buy back after French Elections

Post by Jimmie » Tue Apr 25, 2017 1:49 pm

Since starting on this forum, I have mentally tried to figure out things like this. Now that I have the Boglehead mentality, the reasons why they don't work become more immediately obvious to me.

For example, on Day 1, you have money to invest, but you choose to wait until the market goes down.

SCENARIO 1: The market does not go down. It goes up and perhaps continues to go up. When do you enter the market?
SCENARIO 2: The market goes down as you expected. You enter the market. The market continues to go down.

Under SCENARIO 1, you missed several days of gains. Not good. Under SCENARIO 2, you still lost money even though your plan to avoid losses by waiting for a loss played out. You blew it because you have no way to know when or at what level the real bottom is.

Somewhere, I read that the stock market has always shown gains when taken over any ten-year historical period. ANY ten-year period, even during the Great Depression. This tells me that it's not about timing the market, it's about time IN the market.

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Re: Unwinding all positions and buy back after French Elections

Post by NiceUnparticularMan » Tue Apr 25, 2017 2:22 pm

I am holding a ticket which will either win me $1 or win me $0. I really should sell it for $1--wait, I can only get 50 cents for it? Bummer.

Oh, but I am risk averse, so maybe I will take 50 cents--hey, why is the price I can get only 40 cents?

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Re: Unwinding all positions and buy back after French Elections

Post by Jags4186 » Tue Apr 25, 2017 2:31 pm

Jimmie wrote: Somewhere, I read that the stock market has always shown gains when taken over any ten-year historical period. ANY ten-year period, even during the Great Depression. This tells me that it's not about timing the market, it's about time IN the market.
I believe that was true until 2008.

CAGR SP500 with dividends reinvested 1/1/99 - 12/31/2008: -1.57%
CAGR SP500 with dividends reinvested 1/1/00 - 12/31/2009: -0.99%

Adjusted for inflation you will have more times.

For example the S&P 500 w/ dividends reinvested from 1/1/73 - 12/31/82 saw positive returns of 6.6% but adjusted for inflation saw a -1.91% return.

EDIT:

Actually I was wrong the 10 year period ending 1938 had a -1.4% return but due to deflation investors saw a real return of +0.6%. Although the S&P500 didn't exist then so take that as you will.

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Re: Unwinding all positions and buy back after French Elections

Post by Jimmie » Tue Apr 25, 2017 2:39 pm

Jags4186 wrote:
Jimmie wrote: Somewhere, I read that the stock market has always shown gains when taken over any ten-year historical period. ANY ten-year period, even during the Great Depression. This tells me that it's not about timing the market, it's about time IN the market.
I believe that was true until 2008.

CAGR SP500 with dividends reinvested 1/1/99 - 12/31/2008: -1.57%
CAGR SP500 with dividends reinvested 1/1/00 - 12/31/2009: -0.99%

Adjusted for inflation you will have more times.

For example the S&P 500 w/ dividends reinvested from 1/1/73 - 12/31/82 saw positive returns of 6.6% but adjusted for inflation saw a -1.91% return.

EDIT:

Actually I was wrong the 10 year period ending 1938 had a -1.4% return but due to deflation investors saw a real return of +0.6%.
Thanks for fact-checking me. I'm not off by much. Perhaps what I read cited 12 year periods that showed positive gains, not 10.

I still feel confident enough about the long-term track record of the market to not try to leave it when things look less-than-perfect.

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Re: Unwinding all positions and buy back after French Elections

Post by Fallible » Tue Apr 25, 2017 2:56 pm

youcha wrote:Hi All,

I was wondering, why should anyone run the risk of the impact of politicals risks when holding a portfolio? ...
This is the kind of question that all investors should ask themselves when setting an AA, i.e., how much risk they can handle in order to stay the course In a market downturn, how much money they can afford to lose before needing it.

If you've misjudged your ability, willingness, or need to take risk, then DO reconsider your allocation and bring it in line as best you can by lowering risk. DON'T try to time the market by guessing/predicting what will happen, whether an election, a tech or housing crash, a global financial crisis, etc., etc., then selling and guessing again when to buy back in.
Last edited by Fallible on Tue Apr 25, 2017 3:39 pm, edited 1 time in total.
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Re: Unwinding all positions and buy back after French Elections

Post by jalbert » Tue Apr 25, 2017 2:58 pm

livesoft wrote:
jalbert wrote:Over time, you can expect to win about half the time and lose about half the time when market timing based on predicting the outcome of future events.
"half the time" ?? Do you have a link that supports this 50% statement please?
If the efficient market hypothesis is true, you cannot on average improve expected returns timing the markets. (This is a a more precise way of saying it and is technically different from winning half the time and losing half the time, which was a simplification).

To improve expected return by timing the markets requires exploiting market inefficiencies to the extent that they exist. And if they do, exploiting them is a challenging endeavor requiring far more sophistication than tracking upcoming political and financial events in the news stream.
Last edited by jalbert on Tue Apr 25, 2017 11:50 pm, edited 1 time in total.
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Re: Unwinding all positions and buy back after French Elections

Post by Fallible » Tue Apr 25, 2017 3:51 pm

youcha wrote:yes =) ...
Obviously I am new to investing so you can feel I am still doubting the buy and hold a lot :? ...
By your wish to try timing the market it's easy to see you doubt buy and hold, but since buy and hold has been proven to work, what exactly is it that you doubt?

Can you provide any details of your investments, in particular your allocation? It's entirely up to you, of course.
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Re: Unwinding all positions and buy back after French Elections

Post by roymeo » Tue Apr 25, 2017 4:13 pm

Windup and no return.
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Re: Unwinding all positions and buy back after French Elections

Post by Artsdoctor » Tue Apr 25, 2017 4:58 pm

youcha wrote:Hi All,

I was wondering, why should anyone run the risk of the impact of politicals risks when holding a portfolio?
Given the low cost of investing ( in & out in your favorite low cost broker should run around ~7bps of your portfolio size or so), don't you think it's a good a idea to close all positions before the elections and buy back right after?

I know it's not really buy & hold.... But there is one event there that could break the Eurozone and trigger some bear markets (nice buying opportunities). On the other hand if things go smoothly, global market won't rally 10% up to celebrate...

What do you think?
What you're asking is really whether or not you should be investing internationally. If you're going to have broad international exposure, there's going to be turmoil somewhere in your investment portfolio. In fact, one could make an argument that it's actually SAFER to invest in many markets throughout the world than just restricting your investments to your home country--your portfolio is going to be more diversified.

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unclescrooge
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Re: Unwinding all positions and buy back after French Elections

Post by unclescrooge » Tue Apr 25, 2017 7:58 pm

Vanguard Fan 1367 wrote:I love Jack Bogle, "don't do something, just stand there." :happy
Indeed the hardest part about investing is not doing anything!

TX_Man
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Re: Unwinding all positions and buy back after French Elections

Post by TX_Man » Tue Apr 25, 2017 8:01 pm

unclescrooge wrote:
Vanguard Fan 1367 wrote:I love Jack Bogle, "don't do something, just stand there." :happy
Indeed the hardest part about investing is not doing anything!
Epic quote! Is it from a book?

ray333
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Re: Unwinding all positions and buy back after French Elections

Post by ray333 » Tue Apr 25, 2017 8:07 pm

invest consistently, invest more when prices are cheaper, don't invest anything you "need" in the near term, buy buy buy, sell 20+ years later

pretty much my plan going forward.

oh, bonds at some point. maybe when I'm 40.

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Re: Unwinding all positions and buy back after French Elections

Post by LadyGeek » Tue Apr 25, 2017 8:28 pm

This thread is now in the Investing - Theory, News & General forum (general question).

As a reminder, political comments regarding any country are off-topic, as well as conjecture on economic policy. See: Politics and Religion and the subsequent section.

Please stay focused on the investing aspects.
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Re: Unwinding all positions and buy back after French Elections

Post by Vanguard Fan 1367 » Tue Apr 25, 2017 9:19 pm

TX_Man wrote:
unclescrooge wrote:
Vanguard Fan 1367 wrote:I love Jack Bogle, "don't do something, just stand there." :happy
Indeed the hardest part about investing is not doing anything!
Epic quote! Is it from a book?
The wife and I like to listen to Jack Bogle on YouTube when we travel by car. I am pretty sure that is from one of his talks that we found on YouTube.

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Re: Unwinding all positions and buy back after French Elections

Post by FinancialDave » Wed Apr 26, 2017 12:41 am

unclescrooge wrote:
Vanguard Fan 1367 wrote:I love Jack Bogle, "don't do something, just stand there." :happy
Indeed the hardest part about investing is not doing anything!
:sharebeer
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Re: Unwinding all positions and buy back after French Elections

Post by Rupert » Wed Apr 26, 2017 7:42 am

TX_Man wrote:
unclescrooge wrote:
Vanguard Fan 1367 wrote:I love Jack Bogle, "don't do something, just stand there." :happy
Indeed the hardest part about investing is not doing anything!
Epic quote! Is it from a book?
That quote has been attributed to everyone from Adlai Stevenson to Clint Eastwood. It's not a John Bogle original.

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Re: Unwinding all positions and buy back after French Elections

Post by Maverick3320 » Wed Apr 26, 2017 7:47 am

I would think the markets would rise quite a bit upon Macron's election. Regardless, stay the course.

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Re: Unwinding all positions and buy back after French Elections

Post by Taylor Larimore » Wed Apr 26, 2017 7:50 am

Youcha:

These experts answer your question:
Frank Armstrong, advisor and author of The Informed Investor: "Endless tinkering is unlikely to improve performance, and chasing last period's stellar achiever is a losing strategy."

Barber Odean Study: "Of 66,465 households with accounts at a large discount broker during 1991 to 1996, those that trade most earn an annual return of 11.4 percent, while the market returns 17.9 percent. Our central message is that trading is hazardous to your health."

William Bernstein, author of Four Pillars of Investing: If you become upset when one of your asset classes does poorly, even when the rest of your portfolio is doing well, then you should not be managing your own money."

Jack Bogle: "Stay the Course. No matter what happens, stick to your program. I've said "Stay the course" a thousand times, and I meant it every time. It is the most important single piece of investment wisdom I can give to you."

Bogleheads Guide to Investing: "Wall Street can't stand buy-and-hold strategies because brokers need trading activity to make money."

Jack Brennan, former Vanguard CEO: "If you're determined to succeed at investing, make it your first priority to become a buy-and-hold investor."

Warren Buffett: "Inactivity strikes us as intelligent behavior."

"Andrew Clarke, author of Wealth of Experience: "Setting a goal, developing an appropriate asset allocation, and selecting a handful of funds are not hugely complex tasks. The hard part comes next: Battling your emotions so that you can stick with your plan through thick and thin."

Jonathan Clements, author and Wall Street Journal columnist: "Take my word on it. Buy-and-hold is still your best long-run strategy."

Phil DeMuth, adviser and co-author of seven investment books: "The investor says to his adviser: 'Every year you tell me to do nothing. What do I need you for?' The adviser replied: 'Every year you need me to keep your from doing anything.' "

Paul Farrell, author of Lazy Persons Guide to Investing: "In a study of 66,400 Merrill Lynch investors, professors Odean and Barber discovered that buy-and-hold investors beat the more active investors by a fairly sizable margin: 18.5% to 11.4% over a six-year period."

Rick Ferri, advisor and financial author: "Write down your strategy -- and stay-the-course."

Steve Forbes: "Everyone is a long-term investor until the market goes down."

Alan Greenspan, former Chairman of the Federal Reserve: "The best strategy for equity investor has always been buy and hold, and forget it."

Mark Hebner, author of "Index Funds": "Prices change to reflect news which is both random and unpredictable. Stock picking and market timing don't work. Stay the course in a risk-appropriate index portfolio and invest and relax."

Morgan Housel, financial columnist: "Do nothing" are the two most powerful -- and underused -- words in investing. The urge to act has transferred an inconceivable amount of wealth from investors to brokers."

Michael LeBoeuf, author of The Millionaire in You: "Simple buy-and-hold index investing is one of the best, most efficient ways to grow your money to the ultimate goal of financial freedom."

Jessie Livermore, famous stock trader: "The big money is not in the buying or the selling, but in the sitting."

Burton Malkiel, author of Random Walk Down Wall Street: "Buying-and-holding a broad-based market index fund is still the only game in town."

Morningstar video: Bad Timing Costs Investors 2.5% Per Year

Bill Schultheis, author of The Coffeehouse Investor: "42% of millionaires of this country make less than one transaction per year in their investments."

Fred Schwed Jr. author of "Where are the Customers' Yachts? "It turns out that I should have just bought them (securities) and thereafter I should have just sat on them like a fat, stupid peasant."

Chandan Sengupta, author of The Only Proven Road to Investment Success: "If you are not going to stick to your chosen investment method through thick and thin, there is almost no chance of your succeeding as an investor."

Dan Solin, financial author and adviser: "Once you understand that monitoring the markets is harmful to your long-term returns, a whole new world of opportunities will await you."

Larry Swedroe, advisor and financial author: "There are lots of people out there who have something to gain by your taking action instead of your adhering to your well-thought-out plan."

Eric Tyson, author of Mutual Funds for Dummies: "Don't trade in and out of funds. Stay invested. Not only does buy-and-hold investing offer better returns, but it's also less work."

Jason Zweig, financial author and Wall Street Journal columnist: "The ultimate benefits of owning stocks accrue only to those who can buy and hold."
Best wishes.
Taylor
"Simplicity is the master key to financial success." -- Jack Bogle

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Re: Unwinding all positions and buy back after French Elections

Post by jebmke » Wed Apr 26, 2017 7:51 am

The only unwinding I am interested in as it relates to France involves wine.
When you discover that you are riding a dead horse, the best strategy is to dismount.

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