Anyone screwed up timing the market?

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TheoLeo
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Anyone screwed up timing the market?

Post by TheoLeo » Mon May 25, 2020 10:11 am

I got out in march, saw the market drop further and then rise, rise, rise and now, if the market doesn´t come down again, I have missed the boat :oops:
Anyone else who learned not to time the market?

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yangtui
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Re: Anyone screwed up timing the market?

Post by yangtui » Mon May 25, 2020 10:33 am

Sure, I have known for a long time that timing the market is a fools errand. For the average investor, trying to capture alpha is like panning for gold in your local supermarket's runoff trench. It is important to know your limitations and not act on impulse. I think I know things all the time, but I also know that the human brain is very good at tricking itself into thinking that it is smarter than it actually is.

aristotelian
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Re: Anyone screwed up timing the market?

Post by aristotelian » Mon May 25, 2020 10:52 am

I stayed in but didn't rebalance. I should have done so but I don't like making big trades when things are so volatile. Never had a chance for the market to find a bottom. Missed opportunity for sure but I am OK with it. One thing I have been good at as an investor is never, ever sell when stocks are down. I hate the thought of locking in losses.

Rosencrantz1
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Re: Anyone screwed up timing the market?

Post by Rosencrantz1 » Mon May 25, 2020 11:05 am

Not sure this qualifies as a screw up - I bought equities on the way down and on the way back up. My buying slowed down near the (current) market bottom, though - and, I should have kept it consistent. I started getting a little nervous when the DOW dipped below 19000.

boglethat
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Re: Anyone screwed up timing the market?

Post by boglethat » Mon May 25, 2020 11:22 am

I did too. I sold in April when it was heading back up. I simply panicked and haven't had the nerve to get back in because I fear it is going to drop a lot again. So I guess I am still timing the market; this pandemic has me completely freaked out. It is not easy to admit it on this forum because timing the market is completely against the principles exposed here. I think others have done it but fear admitting it. I think age matters here as well. I am almost 68 so do not have decades to recover. Oddly, I also had a large emergency fund but I still freaked out.

What do you plan to do now?

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willthrill81
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Re: Anyone screwed up timing the market?

Post by willthrill81 » Mon May 25, 2020 11:30 am

aristotelian wrote:
Mon May 25, 2020 10:52 am
I stayed in but didn't rebalance. I should have done so but I don't like making big trades when things are so volatile. Never had a chance for the market to find a bottom. Missed opportunity for sure but I am OK with it. One thing I have been good at as an investor is never, ever sell when stocks are down. I hate the thought of locking in losses.
That's actually the main theme of the Prime Harvesting approach, rebalancing from stocks to bonds but not from bonds to stocks.
“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

Fclevz
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Re: Anyone screwed up timing the market?

Post by Fclevz » Mon May 25, 2020 11:31 am

Have I screwed up timing the market? Yes, every time I’ve ever tried it :D

The cure, for me, was largely psychological. I went to a 50/50 allocation and found that I can stick with that no matter what the markets do.

rockstar
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Re: Anyone screwed up timing the market?

Post by rockstar » Mon May 25, 2020 11:53 am

I did okay. I didn't catch the very bottom, but I got in about half way to the bottom and back up again. This leaves me beating the market this year by roughly 12%. I followed my rule: sold when the market hit the 300 day moving average, and I bought back in when the market's PE hit 20x ttm. That worked for me.

whereskyle
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Re: Anyone screwed up timing the market?

Post by whereskyle » Mon May 25, 2020 11:55 am

TheoLeo wrote:
Mon May 25, 2020 10:11 am
I got out in march, saw the market drop further and then rise, rise, rise and now, if the market doesn´t come down again, I have missed the boat :oops:
Anyone else who learned not to time the market?
Next time just dial up your rate of contributions and keep buying even if it hurts. No way you miss the bottom if you buy everyday. In my view, market timing is harmless if you use it to increase your rate of purchases but never sell.
"I am better off than he is – for he knows nothing and thinks that he knows. I neither know nor think that I know." - Socrates. "Nobody knows nothing." - Jack Bogle

JD2775
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Re: Anyone screwed up timing the market?

Post by JD2775 » Mon May 25, 2020 11:57 am

I re-balanced from bonds to stocks towards the bottom to keep in line with my 70/30 AA (it had drifted to 64/36) , but then the market shot back up so I am not sure it was the right move or not.

samueltorrero
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Re: Anyone screwed up timing the market?

Post by samueltorrero » Mon May 25, 2020 12:00 pm

TheoLeo wrote:
Mon May 25, 2020 10:11 am
I got out in march, saw the market drop further and then rise, rise, rise and now, if the market doesn´t come down again, I have missed the boat :oops:
Anyone else who learned not to time the market?
I learned not to time the market from my corporate finance college text book.

Fallible
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Re: Anyone screwed up timing the market?

Post by Fallible » Mon May 25, 2020 12:17 pm

TheoLeo wrote:
Mon May 25, 2020 10:11 am
I got out in march, saw the market drop further and then rise, rise, rise and now, if the market doesn´t come down again, I have missed the boat :oops:
Anyone else who learned not to time the market?
This is about finding your tolerance for risk, as others here have noted in their examples. Focus now on understanding risk and determining how much you can handle in market drops.

Some questions:
-What was your asset allocation?
-Do you have an Investment Policy Statement?
-Have you read up on risk in general, personal risk tolerance, and asset allocation in the wiki, which includes recommended books and blogs?
Last edited by Fallible on Mon May 25, 2020 12:18 pm, edited 1 time in total.
The first principle is that you must not fool yourself – and you are the easiest person to fool. ~Richard Feynman

aristotelian
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Re: Anyone screwed up timing the market?

Post by aristotelian » Mon May 25, 2020 12:18 pm

willthrill81 wrote:
Mon May 25, 2020 11:30 am
aristotelian wrote:
Mon May 25, 2020 10:52 am
I stayed in but didn't rebalance. I should have done so but I don't like making big trades when things are so volatile. Never had a chance for the market to find a bottom. Missed opportunity for sure but I am OK with it. One thing I have been good at as an investor is never, ever sell when stocks are down. I hate the thought of locking in losses.
That's actually the main theme of the Prime Harvesting approach, rebalancing from stocks to bonds but not from bonds to stocks.
Ah, I didn't know there was a fancy name for it but that's what I do. It should skew conservative but I am OK with that. My plan was to rebalance through new contributions and that worked to an extent but the market bounced back more quickly than I thought.

aristotelian
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Re: Anyone screwed up timing the market?

Post by aristotelian » Mon May 25, 2020 12:18 pm

JD2775 wrote:
Mon May 25, 2020 11:57 am
I re-balanced from bonds to stocks towards the bottom to keep in line with my 70/30 AA (it had drifted to 64/36) , but then the market shot back up so I am not sure it was the right move or not.
Since you bought at the bottom I would say it was definitely the right move (at least for now, knock on wood!).

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Re: Anyone screwed up timing the market?

Post by LadyGeek » Mon May 25, 2020 1:17 pm

I removed several posts and replies discussing the coronavirus. The main intent of the post must be on-topic. In this case, timing the market.

See: Please read before posting on coronavirus/COVID-19
Wiki To some, the glass is half full. To others, the glass is half empty. To an engineer, it's twice the size it needs to be.

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Re: Anyone screwed up timing the market?

Post by Robot Monster » Mon May 25, 2020 1:55 pm

TheoLeo wrote:
Mon May 25, 2020 10:11 am
I got out in march, saw the market drop further and then rise, rise, rise and now, if the market doesn´t come down again, I have missed the boat :oops:
Anyone else who learned not to time the market?
If you're still out of the market, and do not have your desired stock allocation, doesn't that mean you are still timing the market?

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Re: Anyone screwed up timing the market?

Post by bugleheadd » Mon May 25, 2020 1:57 pm

i had a rollover IRA lump of cash i missed out on the 2019 gains and decided to go 50/50 vti cash on 2/19; vti price around $169. talk about bad timing. but at least i only did 50% vti. i guess it could have been worse had i gone 100% vti. i have been avging down with the remainder of cash since then buying VTI in the 120s,130s, and now 140s. my avg cost is in the low 150s so im almost back to break even. wish i bought a whole lot more in the 110s. now im about only 2.5% down from peak account value on 2/19.

UpperNwGuy
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Re: Anyone screwed up timing the market?

Post by UpperNwGuy » Mon May 25, 2020 2:12 pm

I was not tempted to sell. I’m frankly surprised so many people did.

CascadiaSoonish
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Re: Anyone screwed up timing the market?

Post by CascadiaSoonish » Mon May 25, 2020 2:19 pm

Not specific to the current situation, but a few years ago I sold a lagging stock, taking a loss. I had bought it because it was a local business with sound fundamentals. Within a week of my sale they announced they were getting bought out at a premium by Berkshire Hathaway. I made someone a tidy profit that week. No more guessing where the market is going for me, particularly with individual stocks.

rbaldini
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Re: Anyone screwed up timing the market?

Post by rbaldini » Mon May 25, 2020 2:22 pm

TheoLeo wrote:
Mon May 25, 2020 10:11 am
I got out in march, saw the market drop further and then rise, rise, rise and now, if the market doesn´t come down again, I have missed the boat :oops:
Anyone else who learned not to time the market?
n=1. Maybe you're actually a great market timer, but just happened to get unlucky this time!

Tongue in cheek. My point is, suppose this had actually worked out in your favor. Would you conclude that all this don't-time-the-market talk is just for suckers? I hope not: the result of a single data point tells you very little.

Anyway, my recommendation: get back in, if you're not back in yet. Do it right now. Time in the market.

TheDDC
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Re: Anyone screwed up timing the market?

Post by TheDDC » Mon May 25, 2020 2:31 pm

Two years ago around October 2018 there was a flash crash. Sold out of VTSAX/VTIAX at a $2,000 loss (though TLH'd). Markets were up and soaring past 52 week high by February or so. I HUSTLED IT all back via credit card bonuses (not at the pool hall), so no net loss in the end (and a slight tax gain). I learned my lesson. No one really has any business to be jumping in and out of markets. As was mentioned, our brains are wired to think we are the best at everything we try. No, we're not. And definitely not with strategies that have been proven not to work over long periods of time.

-TheDDC
Rules to wealth building: 90-100% VTSAX piled high and deep, 0-10% VIGAX tilt, 0% given away to banks, minimize amount given to medical-industrial complex

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hagridshut
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Re: Anyone screwed up timing the market?

Post by hagridshut » Tue May 26, 2020 1:00 pm

I've become more jaded and cynical about the effectiveness of individually managed portfolios over the years.

Many people who make good plans often cannot stick to them when the markets experience sudden downturns and fear is everywhere. It is easy to read Jack Bogle's books, set an asset allocation, and pick low cost index funds. It is much harder not to sell when the news media is declaring the end of the world, friends and family are screaming to "sell", and every tv screen, mobile device, and computer shows negative numbers.

I believe most people should just pick a Target Retirement fund or Life Strategy asset allocation fund, and then just forget about it. It's either that, or our society will have to do away with these individual accounts or at least have an option for a public pension fund.
First Principles: (1) Diversify (2) Low Cost (3) Stay the Course | 3-Fund Index Portfolio

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arcticpineapplecorp.
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Re: Anyone screwed up timing the market?

Post by arcticpineapplecorp. » Tue May 26, 2020 3:05 pm

yangtui wrote:
Mon May 25, 2020 10:33 am
Sure, I have known for a long time that timing the market is a fools errand. For the average investor, trying to capture alpha is like panning for gold in your local supermarket's runoff trench. It is important to know your limitations and not act on impulse. I think I know things all the time, but I also know that the human brain is very good at tricking itself into thinking that it is smarter than it actually is.
very true. As Richard Feynman put it:
The first principle is that you must not fool yourself and you are the easiest person to fool.
"May you live as long as you want and never want as long as you live" -- Irish Blessing | "Invest we must" -- Jack Bogle

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arcticpineapplecorp.
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Re: Anyone screwed up timing the market?

Post by arcticpineapplecorp. » Tue May 26, 2020 3:10 pm

TheDDC wrote:
Mon May 25, 2020 2:31 pm
Two years ago around October 2018 there was a flash crash. Sold out of VTSAX/VTIAX at a $2,000 loss (though TLH'd). Markets were up and soaring past 52 week high by February or so. I HUSTLED IT all back via credit card bonuses (not at the pool hall), so no net loss in the end (and a slight tax gain). I learned my lesson. No one really has any business to be jumping in and out of markets. As was mentioned, our brains are wired to think we are the best at everything we try. No, we're not. And definitely not with strategies that have been proven not to work over long periods of time.

-TheDDC
you may be referring to the last time (before now) that the market fell around 20% (believe it was 19% in 2018).

However, it was not called a "flash crash" at the time. That term was used when the market dropped precipitously (and mostly recovered) in one day on May 6, 2010: https://www.google.com/search?client=fi ... lash+crash
"May you live as long as you want and never want as long as you live" -- Irish Blessing | "Invest we must" -- Jack Bogle

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Re: Anyone screwed up timing the market?

Post by chicagoan23 » Tue May 26, 2020 3:13 pm

TheoLeo wrote:
Mon May 25, 2020 10:11 am
I got out in march, saw the market drop further and then rise, rise, rise and now, if the market doesn´t come down again, I have missed the boat :oops:
Anyone else who learned not to time the market?
Selling in March may have been a bad idea, but waiting for the market to "come down again" is probably much worse. Even if you sold everything at the low on March 23, you have only missed out on a partial recovery. The market is still 12% or so below all-time highs, with a new tsunami of fiscal stimulus and a coiled spring of output coming as soon as possible. If I were you I would forget about what has happened over the past two months and think about today as a great buying opportunity. You haven't missed the boat at all.
"The Basic Choices for Investors and the One We Strongly Prefer" | | https://www.berkshirehathaway.com/letters/2011ltr.pdf

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arcticpineapplecorp.
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Re: Anyone screwed up timing the market?

Post by arcticpineapplecorp. » Tue May 26, 2020 3:15 pm

JD2775 wrote:
Mon May 25, 2020 11:57 am
I re-balanced from bonds to stocks towards the bottom to keep in line with my 70/30 AA (it had drifted to 64/36) , but then the market shot back up so I am not sure it was the right move or not.
two things:
1. do you use rebalancing bands? Many use a 5% +/- in which case you wouldn't have needed to rebalance until your desired 70/30 went to either 65/35 or 75/25 or more. Since it fell below 65% stocks, it was a good time to rebalance.

2. using rebalancing bands, whether the market "shot back up" or not is not key, but what is the current allocation of your portfolio and if off by 5% or more from the desired 70/30 would tell you what to do (which would be sell stocks now and buy bonds).

https://thefinancebuff.com/5-percent-re ... -band.html
"May you live as long as you want and never want as long as you live" -- Irish Blessing | "Invest we must" -- Jack Bogle

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arcticpineapplecorp.
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Re: Anyone screwed up timing the market?

Post by arcticpineapplecorp. » Tue May 26, 2020 3:16 pm

Fallible wrote:
Mon May 25, 2020 12:17 pm
TheoLeo wrote:
Mon May 25, 2020 10:11 am
I got out in march, saw the market drop further and then rise, rise, rise and now, if the market doesn´t come down again, I have missed the boat :oops:
Anyone else who learned not to time the market?
This is about finding your tolerance for risk, as others here have noted in their examples. Focus now on understanding risk and determining how much you can handle in market drops.

Some questions:
-What was your asset allocation?
-Do you have an Investment Policy Statement?
-Have you read up on risk in general, personal risk tolerance, and asset allocation in the wiki, which includes recommended books and blogs?
good points. For the OP, get an IPS.Start here:

https://www.bogleheads.org/wiki/Investm ... _statement
"May you live as long as you want and never want as long as you live" -- Irish Blessing | "Invest we must" -- Jack Bogle

supersharpie
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Re: Anyone screwed up timing the market?

Post by supersharpie » Tue May 26, 2020 3:24 pm

TheoLeo wrote:
Mon May 25, 2020 10:11 am
I got out in march, saw the market drop further and then rise, rise, rise and now, if the market doesn´t come down again, I have missed the boat :oops:
Anyone else who learned not to time the market?
Me too brother! I moved my 401k holdings to cash within a few percentage points of the bottom. Thankfully about half of my holdings had already been in cash since the end of December (thanks to a seasonal investment scheme that I am also finished following!), so I am still "ahead" on that portion. My plan to put 33% back into my normal target date fund once the S&P 500 closes at over 3000, another 33% after it reaches the number where it stood on 12/31/19, and then hold the other 33% until after the elections.

I kept by wife 100% invested in her target fund and our Roth IRA, as always, in the Wellesley Income Fund; so I could have screwed this up way worse.

We are both 36 and I don't plan on ever timing the market again after this. Just set it and forget it, gradually moving into a more conservative asset allocation in about 10 years when we are a 3-5 years away from early retirement.

LeslieSmiley
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Re: Anyone screwed up timing the market?

Post by LeslieSmiley » Tue May 26, 2020 3:40 pm

supersharpie wrote:
Tue May 26, 2020 3:24 pm
TheoLeo wrote:
Mon May 25, 2020 10:11 am
I got out in march, saw the market drop further and then rise, rise, rise and now, if the market doesn´t come down again, I have missed the boat :oops:
Anyone else who learned not to time the market?
Me too brother! I moved my 401k holdings to cash within a few percentage points of the bottom. Thankfully about half of my holdings had already been in cash since the end of December (thanks to a seasonal investment scheme that I am also finished following!), so I am still "ahead" on that portion. My plan to put 33% back into my normal target date fund once the S&P 500 hits 3000, another 33% after it reaches the number where it stood on 12/31/19, and then hold the other 33% until after the elections.

I kept by wife 100% invested in her target fund and our Roth IRA, as always in the Wellesley Income Fund; so I could have screwed this up way worse.

We are both 36 and I don't plan on ever timing the market again after this. Just set it and forget it, gradually moving into a more conservative asset allocation in about 10 years when we are a 3-5 years away from early retirement.
if i read the above correctly, you sold at the bottom and now you plan to wait for the S&P 500 to hit 3000 and buy some and when it rises back up to what it was in 12/31/19 and then buy some more? so you are basically locking in the loss, am i missing something here?

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TheoLeo
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Re: Anyone screwed up timing the market?

Post by TheoLeo » Tue May 26, 2020 6:24 pm

arcticpineapplecorp. wrote:
Tue May 26, 2020 3:16 pm
Fallible wrote:
Mon May 25, 2020 12:17 pm
TheoLeo wrote:
Mon May 25, 2020 10:11 am
I got out in march, saw the market drop further and then rise, rise, rise and now, if the market doesn´t come down again, I have missed the boat :oops:
Anyone else who learned not to time the market?
This is about finding your tolerance for risk, as others here have noted in their examples. Focus now on understanding risk and determining how much you can handle in market drops.

Some questions:
-What was your asset allocation?
-Do you have an Investment Policy Statement?
-Have you read up on risk in general, personal risk tolerance, and asset allocation in the wiki, which includes recommended books and blogs?
good points. For the OP, get an IPS.Start here:

https://www.bogleheads.org/wiki/Investm ... _statement
It is a mess and I am a bit embarassed about me acting so irrationally, but its the internet, so here it goes :D

I was sitting in cash up until the crash, because I am still early in my career. I wasn´t really sure what the next 5-10 years have in store for me (house purchase, starting a business, moving abroad etc. are all on the table) so I figured I´ll just stay in cash. Then the crash happened and after it had dropped enough, I thought, screw it, the market is in panic, its now or never. So I went pretty much all in (like 2 years of living expenses) 9 th of march 70 % stocks ( world cap) and 30 % global bond aggregate. Stocks continued to crash but this didn´t bother me much. What really really bothered me was the the bond fund dropped 5 % within a few days. I just couldn´t stand to see the bond fund, which was supposed to stabilize, drop together with the stocks and even faster than the stocks. I sold it all, then went back in 100 % stocks a few days later, stayed in until the fist little recovery 30th of march I think, and then went all out again :D

There you have it, its a mess. I was reacting to the news and what I saw arount me and projected that to the market. Mistake. But the real mistake and what made me succeptible to the noise was that I had no business being in the market in the first place. There was no need for me to be there. It was greed and maybe the frustration that FI investments in my country have a negative nominal return. Saving for a potential cash need a few years down the road is a real PITA like this and incentivizes people like me to assume more risk than they need.

stan1
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Re: Anyone screwed up timing the market?

Post by stan1 » Tue May 26, 2020 6:27 pm

I seem to be better at buying low than selling high.

I learned my lesson with QCOM stock 22 years ago.

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TheoLeo
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Re: Anyone screwed up timing the market?

Post by TheoLeo » Tue May 26, 2020 6:34 pm

supersharpie wrote:
Tue May 26, 2020 3:24 pm
Me too brother!
Bogleheads aren´t born, they are made.

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Re: Anyone screwed up timing the market?

Post by supersharpie » Tue May 26, 2020 6:35 pm

LeslieSmiley wrote:
Tue May 26, 2020 3:40 pm
supersharpie wrote:
Tue May 26, 2020 3:24 pm
TheoLeo wrote:
Mon May 25, 2020 10:11 am
I got out in march, saw the market drop further and then rise, rise, rise and now, if the market doesn´t come down again, I have missed the boat :oops:
Anyone else who learned not to time the market?
Me too brother! I moved my 401k holdings to cash within a few percentage points of the bottom. Thankfully about half of my holdings had already been in cash since the end of December (thanks to a seasonal investment scheme that I am also finished following!), so I am still "ahead" on that portion. My plan to put 33% back into my normal target date fund once the S&P 500 hits 3000, another 33% after it reaches the number where it stood on 12/31/19, and then hold the other 33% until after the elections.

I kept by wife 100% invested in her target fund and our Roth IRA, as always in the Wellesley Income Fund; so I could have screwed this up way worse.

We are both 36 and I don't plan on ever timing the market again after this. Just set it and forget it, gradually moving into a more conservative asset allocation in about 10 years when we are a 3-5 years away from early retirement.
if i read the above correctly, you sold at the bottom and now you plan to wait for the S&P 500 to hit 3000 and buy some and when it rises back up to what it was in 12/31/19 and then buy some more? so you are basically locking in the loss, am i missing something here?
I look at it as cutting my losses. Keep in mind that I sold half my shares when the S&P 500 was at around 3200. So with that initial 33% purchase at 3000 I will actually be realizing a gain and I will be breaking even on half of my second purchase at the closing price on 12/31/19.

The only loss I will definitely be realizing is on the 16% of total 401k assets that I am moving back into the target date fund with my second purchase.

Mental gymnastics, I know. The alternative is waiting for the market to retest its March lows. Some people are still sitting on the $$$ they cashed out when the market tanked in '08-'09. I don't want to be that guy.

I also don't want to be in this position ever again, which is why I am setting and forgetting it from here on out, with the exception of changing our AA as we approach retirement.

supersharpie
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Re: Anyone screwed up timing the market?

Post by supersharpie » Tue May 26, 2020 6:46 pm

TheoLeo wrote:
Tue May 26, 2020 6:34 pm
supersharpie wrote:
Tue May 26, 2020 3:24 pm
Me too brother!
Bogleheads aren´t born, they are made.
Yup, I was never a true Boglehead in that I persisted in seasonally investing my 401k for the first 10 years I was maxing out my contributions...because it worked so well in the prior 25 years vs what the S&P 500 returned (we are talking about a 400% difference). I clung to the belief that I would eventually benefit from this choice, plus didn't feel like I was risking our dreams of early retirement because I was "setting and forgetting" more than 60% of our investments (my wife's 401k + both our Roth IRAs).

Who knows, maybe I would have ended up ahead of the game if I continued down this path for the next 40+ years. As it stands, this investing strategy cost me significantly during the raging bull market we entered at the same time I started seasonally investing, probably to the tune of 100k. The good news is that we still have a significant level of assets in proportion to our spending habits and are still on track to retire around 50. Quite frankly, the only folks who will be materially hurt by the100k+ I lost out on are those served by the charities we will leave our assets to after we pass.

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arcticpineapplecorp.
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Re: Anyone screwed up timing the market?

Post by arcticpineapplecorp. » Tue May 26, 2020 9:07 pm

TheoLeo wrote:
Tue May 26, 2020 6:24 pm
arcticpineapplecorp. wrote:
Tue May 26, 2020 3:16 pm
Fallible wrote:
Mon May 25, 2020 12:17 pm
TheoLeo wrote:
Mon May 25, 2020 10:11 am
I got out in march, saw the market drop further and then rise, rise, rise and now, if the market doesn´t come down again, I have missed the boat :oops:
Anyone else who learned not to time the market?
This is about finding your tolerance for risk, as others here have noted in their examples. Focus now on understanding risk and determining how much you can handle in market drops.

Some questions:
-What was your asset allocation?
-Do you have an Investment Policy Statement?
-Have you read up on risk in general, personal risk tolerance, and asset allocation in the wiki, which includes recommended books and blogs?
good points. For the OP, get an IPS.Start here:

https://www.bogleheads.org/wiki/Investm ... _statement
It is a mess and I am a bit embarassed about me acting so irrationally, but its the internet, so here it goes :D

Stocks continued to crash but this didn´t bother me much. What really really bothered me was the the bond fund dropped 5 % within a few days. I just couldn´t stand to see the bond fund, which was supposed to stabilize, drop together with the stocks and even faster than the stocks. I sold it all, then went back in 100 % stocks a few days later, stayed in until the fist little recovery 30th of march I think, and then went all out again :D
is it true that the bonds "fell faster than the stocks"?
that's not what I see when I look at the chart (blue is stock, orange is bond):

http://quotes.morningstar.com/chart/fun ... A%5B%5D%7D

something similar happened in 2008 (bonds fell at the same time that stocks did). Perhaps you weren't investing then, or didn't learn that lesson until now. This is why the more we learn about financial history the more prepared we can be and know how to act better than others before.

In 2008 in Oct the bond market index fell too. see the chart (blue is stock, orange is bond):

http://quotes.morningstar.com/chart/fun ... A%5B%5D%7D

here's the thing, though. The stock market fell much farther than the bond market (then as now). here's the other thing, the bond market recovered much quicker than the stock market (then as now).

no one ever said bonds didn't carry risk. However, the right kinds of bonds (high quality short to intermediate) carry less risk than stocks. So they should lose less and recover faster. A 50/50 portfolio recovered from 2008 by 2010, but an all stock investor would have had to wait until March 2012 to have broken even.

while bonds are less risky, they're usually less rewarded (the chart shows you that as well. Stocks did better over the past 12 years than bonds, even though bonds did well too).
"May you live as long as you want and never want as long as you live" -- Irish Blessing | "Invest we must" -- Jack Bogle

gr7070
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Re: Anyone screwed up timing the market?

Post by gr7070 » Tue May 26, 2020 10:19 pm

In the late 90s I used to "week-trade". I had a bunch of stocks on margin when the dot bomb hit. Fortunately I had made more on the way up than I lost in the way down.

I learned a great lesson, even though I had already known better.

My roommate worked for Macromedia at the time. Stock went from 100 to 20. We knew a bunch of young millionaires who weren't anything close after not selling. This empathised that lesson.

Haven't made a timing "mistake" in 20 years!

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Darth Xanadu
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Re: Anyone screwed up timing the market?

Post by Darth Xanadu » Tue May 26, 2020 10:32 pm

Sort of?

I made my 2020 Roth IRA contribution on April 22. That $6k is still sitting in cash. Could be $500 richer right now!

gr7070
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Re: Anyone screwed up timing the market?

Post by gr7070 » Tue May 26, 2020 10:35 pm

I think age matters here as well. I am almost 68 so do not have decades to recover. Oddly, I also had a large emergency fund but I still freaked out.
I think that's confirmation bias.

I'm 48. And I invested through the dot bomb and great recession, and lived through Black Monday; old enough to be aware (actually owned stock I had bought as a 12 year old, so I guess I was -barely- invested through BM as well).

So yeah; age matters - I'm old enough to know better!

I've got "only" about 7 years to recover before I (hopefully) retire. After that 7 years I've got only about 30-40 years of expenses to account for. Meh. That's what the plan is for. We, here, have the best plan known; stick to it.

Not that it actually matters any, but there are supposed renowned economists predicting a fast recovery for most of the nation; and thus the financial markets to follow suit. So get back in or potentially lag behind further.

I'm highly skeptical, but I'm not acting on any economists in either direction.

I played poker with a guy about 5+ years ago. He moved everything he had out of the markets - was convinced we were in a bubble. Would love to have seen him at a table 3 months ago.
Last edited by gr7070 on Wed May 27, 2020 12:57 am, edited 3 times in total.

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calvin+hobbes
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Re: Anyone screwed up timing the market?

Post by calvin+hobbes » Tue May 26, 2020 10:47 pm

supersharpie wrote:
Tue May 26, 2020 3:24 pm
TheoLeo wrote:
Mon May 25, 2020 10:11 am
I got out in march, saw the market drop further and then rise, rise, rise and now, if the market doesn´t come down again, I have missed the boat :oops:
Anyone else who learned not to time the market?
Me too brother! I moved my 401k holdings to cash within a few percentage points of the bottom. Thankfully about half of my holdings had already been in cash since the end of December (thanks to a seasonal investment scheme that I am also finished following!), so I am still "ahead" on that portion. My plan to put 33% back into my normal target date fund once the S&P 500 closes at over 3000, another 33% after it reaches the number where it stood on 12/31/19, and then hold the other 33% until after the elections.

I kept by wife 100% invested in her target fund and our Roth IRA, as always, in the Wellesley Income Fund; so I could have screwed this up way worse.

We are both 36 and I don't plan on ever timing the market again after this. Just set it and forget it, gradually moving into a more conservative asset allocation in about 10 years when we are a 3-5 years away from early retirement.
Your numbers are fairly arbitrary and you seem likely to compound your market timing loss with more market timing. Wouldn’t you rather get back in below those numbers? Why does it make sense to wait to pay more for a share at SPX3000 and 12/31/19 close? Seems like it would be easier (And more profitable) to get back to the set and forget mentality by DCA on a schedule or lump sum. Good luck.
Last edited by calvin+hobbes on Tue May 26, 2020 10:51 pm, edited 1 time in total.

wolf359
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Re: Anyone screwed up timing the market?

Post by wolf359 » Tue May 26, 2020 10:50 pm

This coronavirus pandemic is a classic example of the difficulty of timing the market. A number of people saw the obvious in January and February. The drumbeat of constant news regarding China, and it was getting more and more obvious that it was going to eventually impact the US and the rest of the world. A number of people here declared they were getting out in late February through early March, while the markets were at nosebleed levels. And... They were RIGHT! The market fell.

Now, the market is climbing again, even though there is no cure, and the virus isn't even contained in many states. It looks like the market is in denial again, and massive unemployment is not just looming, it's here. Even though businesses are re-opening, customers may not be coming back. The market is closing in on its previous highs -- is the market wrong again? Those who previously bailed are now missing out on the rally, or will it fall again?

I personally feel that the worst is yet to come, but meanwhile the market is climbing anyways. I have learned many years ago that the market reacts in ways that I cannot fathom. Sometimes I am right, but sometimes I am wrong. It is really obvious to me that the market is in denial, but perhaps it is I who is in denial.

I keep to my asset allocation and stay in. I have not been acting on my opinions. I was kicking myself in February for not selling out, but now I am happy that I didn't. I am simply cutting expenses as much as possible and buying whenever I have the funds. I have also learned that if you are going to time the market, do so by simply rebalancing early. Then you still stay invested, and the impact of a timing area is limited to risks you were already willing to take. (Don't switch from 100% stocks to 100% bonds and back.)

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Re: Anyone screwed up timing the market?

Post by justsomeguy2018 » Tue May 26, 2020 11:32 pm

Darth Xanadu wrote:
Tue May 26, 2020 10:32 pm
Sort of?

I made my 2020 Roth IRA contribution on April 22. That $6k is still sitting in cash. Could be $500 richer right now!
Sort of similar....I DCA'd my $6k Roth into a climbing market (lump sum wouldve been better), but I did manage to get it all in.

dropdx
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Re: Anyone screwed up timing the market?

Post by dropdx » Tue May 26, 2020 11:38 pm

aristotelian wrote:
Mon May 25, 2020 10:52 am
I stayed in but didn't rebalance. I should have done so but I don't like making big trades when things are so volatile. Never had a chance for the market to find a bottom. Missed opportunity for sure but I am OK with it. One thing I have been good at as an investor is never, ever sell when stocks are down. I hate the thought of locking in losses.
So you don't TLH?

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dogagility
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Re: Anyone screwed up timing the market?

Post by dogagility » Wed May 27, 2020 5:48 am

yangtui wrote:
Mon May 25, 2020 10:33 am
For the average investor, trying to capture alpha is like panning for gold in your local supermarket's runoff trench.
That... was... AWESOME! :sharebeer
"The stock market is a device for transferring money from the impatient to the patient" -- Warren Buffett

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dogagility
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Re: Anyone screwed up timing the market?

Post by dogagility » Wed May 27, 2020 5:53 am

whereskyle wrote:
Mon May 25, 2020 11:55 am
Next time just dial up your rate of contributions and keep buying even if it hurts. No way you miss the bottom if you buy everyday. In my view, market timing is harmless if you use it to increase your rate of purchases but never sell.
Where is this money coming from "to increase your rate of purchases"? Seems like it must be on the sideline, not invested at your chosen asset allocation. How is this not market timing?
"The stock market is a device for transferring money from the impatient to the patient" -- Warren Buffett

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Stef
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Re: Anyone screwed up timing the market?

Post by Stef » Wed May 27, 2020 6:10 am

Started investing in December 2019 with 2/3 of my assets that I currently hold and lump sum invested my bonus (the other 1/3) when the SP500 was at 3380. So basically my avg. buying price was around 3250.

I wasn't timing the market, but the timing couldn't be worse lol.

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Re: Anyone screwed up timing the market?

Post by whereskyle » Wed May 27, 2020 6:31 am

dogagility wrote:
Wed May 27, 2020 5:53 am
whereskyle wrote:
Mon May 25, 2020 11:55 am
Next time just dial up your rate of contributions and keep buying even if it hurts. No way you miss the bottom if you buy everyday. In my view, market timing is harmless if you use it to increase your rate of purchases but never sell.
Where is this money coming from "to increase your rate of purchases"? Seems like it must be on the sideline, not invested at your chosen asset allocation. How is this not market timing?
It's pennies. Under any sky I make automatic weekly contributions at a predetermined rate and 401k automatic contributions biweekly. But when the market gets rough, I try extra hard to cut down discretionary expenses and increase stock purchases. It's market timing with respect to buying stocks, and I do it as a mental and behavioral check to prevent me from doing the very worst thing one can do when "market timing": sell when the market is dropping. I never feel, "Oh no, I increased my rate of contributions because I was scared." I feel, "good thing" I increased my rate of contributions so I could get to where I want to be more quickly, and very good thing I didn't sell."
"I am better off than he is – for he knows nothing and thinks that he knows. I neither know nor think that I know." - Socrates. "Nobody knows nothing." - Jack Bogle

aristotelian
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Re: Anyone screwed up timing the market?

Post by aristotelian » Wed May 27, 2020 6:41 am

dropdx wrote:
Tue May 26, 2020 11:38 pm
aristotelian wrote:
Mon May 25, 2020 10:52 am
I stayed in but didn't rebalance. I should have done so but I don't like making big trades when things are so volatile. Never had a chance for the market to find a bottom. Missed opportunity for sure but I am OK with it. One thing I have been good at as an investor is never, ever sell when stocks are down. I hate the thought of locking in losses.
So you don't TLH?
I absolutely TLH. I don't consider that selling so much as changing the ticket symbol.

investingdad
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Re: Anyone screwed up timing the market?

Post by investingdad » Wed May 27, 2020 6:54 am

aristotelian wrote:
Mon May 25, 2020 10:52 am
I stayed in but didn't rebalance. I should have done so but I don't like making big trades when things are so volatile. Never had a chance for the market to find a bottom. Missed opportunity for sure but I am OK with it. One thing I have been good at as an investor is never, ever sell when stocks are down. I hate the thought of locking in losses.
I did the same.

And it's not screwing up, it's falling back on a proven strategy during a period of uncertainty.

Staying the course means just that. Nobody got any cheap shares from me because I did nothing.

LeslieSmiley
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Re: Anyone screwed up timing the market?

Post by LeslieSmiley » Wed May 27, 2020 10:34 am

i was supposed to rebalance from 73/27 to 66/34 but i dragged my feet and the drop came. i "rebalanced" half of the amount after the initial drop on that monday (i think it was a few percentage). then i waited until the market recovered quite a bit a few weeks ago to "rebalance" the other half of the amount. so i am at 66/34 and i don't plan on changing it. during all these times, i continued to max out on my retirement accounts based on my AA ratio.

so a bit of missing the all the time high to rebalance, but making some damage control by "timing the market" a little in the subsequent rebalancing.

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Re: Anyone screwed up timing the market?

Post by lostdog » Wed May 27, 2020 11:11 am

No but it was hard staying the course during those nasty drops. What made it hard was coming here and seeing the bears and trolls daring us to sell. It felt like they were purposely trying to get us to screw up. Most have since disappeared. I'm sure the moderators were busy during that time.
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