Is anyone waiting until after the election?

[yules]

I know, I know: Time in the market, not timing the market.

BUT:

I have some new cash (about 6% of total portfolio) and I'm curious whether anyone else is waiting until after the US election in 45 days?

On election night we n 2016, when it was apparent that Trump was going to win, stock futures absolutely plummeted. What happens the day after? The stock market soared.

So the stock market wasn’t sure what it was going to do when it had basically the same information (ie, Trump victory), so I don’t think any one of us knows either!

So no need to wait until after the election for that stock market fall (or soar), since you (and I and everyone else here) is clueless.

Go invest!
Yules

[invest4]

Nay. Accumulating cash with new monies...but due to valuations (Cape 30+), not the election. Not selling anything.

[MathWizard]

No.

I am waiting for the new year so that I can start dropping more money into retirement accounts, I'll be maxed out by the election.

[bigskyguy]

Yes, and beyond. With the US market at the extremes of valuation, with returns on fixed income investments universally at levels that have no parallel, with debt levels also at extremes, seems to me we are in sone form or fashion approaching an economic infection point not seen in 90 years. The upside for equities and fixed incomes are limited, the downsides substantial. I’m in no hurry. I’ll keep what I have.
Full disclosure, I am retired, comfortably positioned, and have little need to take risk at these levels and in this economic and political environment.

[palaheel]

I'm at roughly market cap globally, and tilt toward small and value. I'm not changing my plans. I might feel like going off a bridge in mid-November , but I don't know how to allocate my assets any better.

[GuySmiley]

Most of my investing decisions have moved to autopilot. Not acting does not mean waiting, it just means rebalancing will happen when it is supposed to happen, regardless of any external event.

[windaar]

I have never understood why the Boglehead Mods will lock "political" and "medical" posts, because they are outside of the scope of Jack Bogle finance topics, but will allow "timing" posts which are also well outside of the scope of Jack Bogle finance topics.

[justsomeguy2018]

I know, I know: Time in the market, not timing the market.

BUT:

I have some new cash (about 6% of total portfolio) and I'm curious whether anyone else is waiting until after the US election in 45 days?

I would wait.

You might miss out on a small pop, but you might also get in a lot cheaper.

There are a lot of scenarios that could happen, beyond whether who wins or loses....

[JBTX]

I have never understood why the Boglehead Mods will lock "political" and "medical" posts, because they are outside of the scope of Jack Bogle finance topics, but will allow "timing" posts which are also well outside of the scope of Jack Bogle finance topics.

Politics is very contentious. It overwhelms everything. As someone who has participated in political forums for over a decade, I can attest to it. It would require lots of moderation.

Medical is just out of scope, and you really don't want people posting bad medical advice on an investment forum

Market timing is investing. Investing posts are generally not limited. You can be a market timer and post here. You just have to be prepared for the onslaught of disagreement.

[White Coat Investor]

Always be investing.

[000]

I have never understood why the Boglehead Mods will lock "political" and "medical" posts, because they are outside of the scope of Jack Bogle finance topics, but will allow "timing" posts which are also well outside of the scope of Jack Bogle finance topics.

Jack Bogle made at least one major market timing move, substantially reducing stock allocation shortly before the dot com bubble burst.

Would you have banned him from talking about that here?

[bonglehead]

I am sitting on a large chunk of cash from the recent sale of my house. I decided to not put all the proceeds to the down payment of our new house (limited it to 20% down payment).
I am going to let it sit in cash (abt 25% of my total investments) for some time while I figure out the next steps and it’s unlikely that I will plough it into the market before the elections.

[pasadena]

I have never understood why the Boglehead Mods will lock "political" and "medical" posts, because they are outside of the scope of Jack Bogle finance topics, but will allow "timing" posts which are also well outside of the scope of Jack Bogle finance topics.

Market timing is about investing. It might be (in part) contrary to the philosophy, but still right on topic and worth discussing.

Politics and medical are not about investing and clearly out of scope.

Not that I fully agree with the policy but I admit that thanks to it, this forum can be a relief from the rest of the Internet

[LadyGeek]

This is a "no politics" forum. On Page 1, I removed a post conjecturing on election results (off-topic). A general discussion of market timing (that does not go into political details) is OK.

If anyone has an opinion on the forum guidelines, please PM me. Don't post here.

[Seasonal]

For waiting to make sense you would have to be better than the market at predicting the results of the election and be better than the market at predicting how the market will react to those results and you would have to have concluded that the results of the election will be negative for the market. It would seem unlikely that all of these are true.

[brad.clarkston]

Local elections have far more impact on your life than federal so no I invest according to plan.

[bogledogle]

I know, I know: Time in the market, not timing the market.

BUT:

I have some new cash (about 6% of total portfolio) and I'm curious whether anyone else is waiting until after the US election in 45 days?

If this is money that you intend to invest anyway, you will probably be better off investing and tax loss harvesting if there is a significant drop around the election time. If you are not comfortable investing it, holding ~6% of your portfolio in cash is not a big deal.

I have more than 6% of my portfolio value in cash that has been set aside for other things. I am not waiting until after the election, but if there is a market dip, I will dip into that cash and invest some of it.

[warner25]

Local elections have far more impact on your life than federal so no I invest according to plan.

This is false for federal employees and certainly for military service members, but I think following politics is only helpful for anticipating pay raises and career opportunities, not stock market movements.

[topper1296]

Why not split the difference and invest half now and the other after the election?

[FarmWife]

I'm plowing in more. Upping my 401k contributions to 50% for Oct/Nov/Dec (for tax management not market timing) but it will be interesting to see the results. I agree that the market doesn't like uncertainty, so I feel that any extra I can put in will surely grow, but growing the next 3 months doesn't matter as much as whether it will be higher or lower 10 to 50 years from now. I believe it should be higher in that time frame so what it does in the next 3 months doesn't really matter.

If you're still years from retirement, just stay the course with regular investments.

[bling]

sure, markets don't like uncertainty, but in this election there's actually very little. no matter what happens, the market will either be working with an incumbent president who is re-elected, or a former VP become the new president. in both cases, there's a ton of preexisting information already for both candidates.

if anything, what happens with a potential second wave of the virus during flu season is far more impactful for uncertainty.

[oldfort]

Local elections have far more impact on your life than federal so no I invest according to plan.

This is false for federal employees and certainly for military service members, but I think following politics is only helpful for anticipating pay raises and career opportunities, not stock market movements.

Even for federal employees, except at the political appointee level, national elections can have relatively little impact in terms of pay and benefits. Unless the same party controls the House, the Senate, and the Presidency, it can be difficult for any major legislative changes to pass. The military can be more vulnerable to force shaping and RIFs.

[JimmyJammy]

I think there will be a lot of opportunity during the volatility leading up to the election and likely through the 4 or so weeks following the election. So, buy when the selling is extreme. It worked out in March.

[celia]

I have some new cash (about 6% of total portfolio) and I'm curious whether anyone else is waiting until after the US election in 45 days?

Let me see if I can ask this without getting in trouble...

The stock markets are open usually 5 days a week. What date(s) are you considering as "the US election"? "This year it's different" since voting is spread out over a longer period than usual. And the results may not be known for days (or weeks?) afterwards. So what stock market date(s) should I look at in order to confirm the election is impacting the markets (or not)?

[terran]

We just lump summed a windfall at the beginning of the week that increased our net worth by almost 1/3, so no we didn't wait for the election.

[ohboy!]

The interesting thing to me is the more people who are holding cash waiting to buy the less downside potential there is. Here majority aren’t holding cash. Robinhooders are holding debts. I don’t see any certainty from either election result given the level of tension. Im feeling like a bear and Im waiting.

[UpperNwGuy]

I invest the same amount on the first day of each month without regard to market movements or other uncertainties.

[lane7068]

Yep, I've cut my investing money in half, although still making weekly and bi-weekly purchases in my three accounts. I've got a bit of cash just sitting and waiting on sidelines as I feel there is more potential to the downside than the upside. I could be wrong. Probably are.

Although it wont matter much 5-10 yrs from now, my fear and/or greediness wont let me toss it all in at this point.

[Nicolas]

I have some new cash (about 6% of total portfolio) and I'm curious whether anyone else is waiting until after the US election in 45 days?

Let me see if I can ask this without getting in trouble...

The stock markets are open usually 5 days a week. What date(s) are you considering as "the US election"? "This year it's different" since voting is spread out over a longer period than usual. And the results may not be known for days (or weeks?) afterwards. So what stock market date(s) should I look at in order to confirm the election is impacting the markets (or not)?

Could be January 20.

[Wanderingwheelz]

I made a decent $90,000 contribution to my taxable account a week ago and I invested half of it. The remainder I’m going to wait with not because I’m fearful, simply because I don’t like to make lump sum investment over $50,000 with earned income.

[columbia]

Trying to predict how the markets will react to an election seems problematic.

I have a relative who bought a large chunk of physical gold the day after the 2008 election (based on his politics and perceived understanding of the future of the economy and markets). One can reasonably say that he should not have done that:
https://www.portfoliovisualizer.com/bac ... ion2_2=100

[TimeTheMarket]

This isn't timing the market, at least not for greed, this is a purely risk aversion or anti-volitility play

A rose by any other name.

It's surprising how often I see people here call things not market timing which are clearly market timing.

As for buying in now? I absolutely get people's fear. 200 (?) points S&P500 above pre-covid records was hard to believe. And there are lots of signs covid is not at all under control in Europe, at least. It's very easy to see big path down from here.

Intellectually I know that the thing to do is invest whenever you can and not time it. But emotionally it would be hard to buy in right now. My guess (Just guessing) is we'll be lower a week from now than we are today.

[Chicken Little]

I know, I know: Time in the market, not timing the market.

BUT:

I have some new cash (about 6% of total portfolio) and I'm curious whether anyone else is waiting until after the US election in 45 days?

It depends on your short/long term goals.

If you want all of the gains, then investing now improves your odds. If you want to avoid the worst losses, then waiting probably makes sense (it's not actually random, there is likely a higher probability of a downside reaction to the result, as the upside is already priced it with current high valuations, albeit getting a little choppy - probabilities, not guarantees).

If you want more than all of the gains by timing away the worst of the losses, you need to start a hedge fund.

I invest every two weeks, and then have a store of money currently in bonds to rotate to equity if there is a a major decline for any reason.

[Rudedog]

Its a marathon, not a sprint. I just keep my funds and allocations about the same.

[LadyGeek]

This is a "no politics" forum. An off-topic post expressing a political preference has been removed. As a reminder, see: Politics and Religion

In order to avoid the inevitable frictions that arise from these topics, political or religious posts and comments are prohibited. The only exceptions to this rule are:

• Common religious expressions such as sending your prayers to an ailing member.
• Usage of factual and non-derogatory political labels when necessary to the discussion at hand.
• Discussions about enacted laws or regulations that affect the individual investor. Note that discussions of proposed legislation are prohibited.
• Proposed regulations that are directly related to investing may be discussed if and when they are published for public comments.

This discussion is about timing the market relative to the upcoming federal elections. Please stay focused on the investing aspects.

[CyclingDuo]

I know, I know: Time in the market, not timing the market.

BUT:

I have some new cash (about 6% of total portfolio) and I'm curious whether anyone else is waiting until after the US election in 45 days?

Election!

That seems to be the talking trend that many birds have rotated towards. There's always a talking trend. Like birds, those who hang on the words of each talking trend flock and fly to and fro in a never ending manner. Trends come and go. Corrections come and go.

What will the next talking trend be? What about the one after that? And the one after that? And that? When will we have the next correction after this one? What about the one after that? And the one after that? And that?

Many have provided you with options. Buy one share of VTI each and every day between now and the election so you are at least investing and somewhat participating. Put 1/2 in now, and 1/2 in after the election. Put it all in now. Put it all in after the election. Buy on every Thursday. Buy during a full moon. Buy when the sky is cloudy. Buy when it is blue. Buy in February. Buy when you post on a forum to get opinions from strangers.

At some point it gets absurd and you lose the focus and forget about getting down to the sheer business of investing.

Get out the comic book and decide if we should call you Tiffany, Brittany, or Sarah.

https://imgur.com/gallery/BlK4jzM

CyclingDuo

[Steadfast]

I know, I know: Time in the market, not timing the market.

BUT:

I have some new cash (about 6% of total portfolio) and I'm curious whether anyone else is waiting until after the US election in 45 days?

Why would anyone do that?

[Sandtrap]

Ignore the news, tv, talking heads, etc.

The sky is always falling.
Chicken Little.

j

[wolf359]

I know, I know: Time in the market, not timing the market.

BUT:

I have some new cash (about 6% of total portfolio) and I'm curious whether anyone else is waiting until after the US election in 45 days?

Did you wait in 2016? What was the result?

In 2016, Clinton was ahead in the polls and was expected to win on election day. She didn't. The market was actually climbing thoughout most of 2016. Every time it looked like Trump would win, the market would drop. Therefore, I expected that when Trump won, the market would fall. I therefore rebalanced just before the election (out of cycle) so that I was ready either way. This took profits off the table instead of letting the equities keep running.

The market did indeed dip in the morning after when the election results were announced. But it recovered and was positive by the end of the day. And it went on a tear, continuing the bull market. In retrospect, I wish I hadn't rebalanced, as I would have been better off if I had let the profits run. I would have ended up rebalancing 3-4 months later anyways.

The stock market partially runs on emotions. Elections affect emotions. Therefore, political events can have a short-term impact on the stock market. However, you should be investing with a long-term mindset. It's not a question of where the market will be in 2 months, but where it will be in 30 years. You don't know if the market will go up or down the day after the election.

I'd advise you to make sure your emergency fund is fully funded, then follow your investors policy statement. Your asset allocation currently has 6% in cash. What does it say to do?

[Robot Monster]

The stock market partially runs on emotions. Elections affect emotions. Therefore, political events can have a short-term impact on the stock market. However, you should be investing with a long-term mindset. It's not a question of where the market will be in 2 months, but where it will be in 30 years.

Well said.

[brad.clarkston]

Local elections have far more impact on your life than federal so no I invest according to plan.

This is false for federal employees and certainly for military service members, but I think following politics is only helpful for anticipating pay raises and career opportunities, not stock market movements.

Even for federal employees, except at the political appointee level, national elections can have relatively little impact in terms of pay and benefits. Unless the same party controls the House, the Senate, and the Presidency, it can be difficult for any major legislative changes to pass. The military can be more vulnerable to force shaping and RIFs.

My wife is a current long term Fed employee and I'm former active Army (enlisted) and I can say the Federal level almost never bothers us. The only current issue my wife has is the suspend federal payroll tax that just means she has to remember she will pay that back at tax time as it's not going to make it through congress. I never cared what the fed's did as Army or after only deployments and combat mattered.

The thing that can get you is the local elections that can radically change school/police/fire/infrastructure/school taxing and even that doesn't change my investing as much as my tax considerations.

In this always connected world people forget that the further you are away from Washington the less it effects you.

[firebirdparts]

To me, it makes a ton of sense to just look at the historical stock market returns and try to identify USA political events in the past. It's unfruitful. Try it. It seems to me that anybody with a lick of sense would have done this already, because there are always people talking about how politics "will" effect the stock market. If any of that is true, it should have happened at least a little bit in the past.

[Forester]

For anyone interested, Betfair Exchange is the largest political betting market; https://www.betfair.com/exchange/plus/p ... .128151441

I won money on Brexit, the "red team nominee" at 7 to 1 in late '15, and on the November '16 election. Mostly staying clear of this one, I haven't developed a feel for it.

[tesuzuki2002]

I know, I know: Time in the market, not timing the market.

BUT:

I have some new cash (about 6% of total portfolio) and I'm curious whether anyone else is waiting until after the US election in 45 days?

Who here thinks we will have an election decision and or a clear winner in 46 days? I for one don't think that... I don't know if we'll have a decision on it even this year.

For the record, I'm still investing every week.

[Normchad]

I’m surprised by the number of folks that are waiting until after the election to invest.

For those waiting, have any of you also taken money out of the market, adjusted your portfolio in other ways because of this?

[JackoC]

I know, I know: Time in the market, not timing the market.
BUT:
I have some new cash (about 6% of total portfolio) and I'm curious whether anyone else is waiting until after the US election in 45 days?

On election night we n 2016, when it was apparent that Trump was going to win, stock futures absolutely plummeted. What happens the day after? The stock market soared.
So the stock market wasn’t sure what it was going to do when it had basically the same information (ie, Trump victory), so I don’t think any one of us knows either!

Yeah that is an additional possible distinction, that market doesn't necessarily 'know' what it's going to do with various election outcomes as opposed to some unknowns you can more readily reduce to binary good/bad from market's POV, or even estimate how good/bad. And, who has control of the Senate when the dust settles, and how long it takes the dust to settle, could have major impacts. Those things could also have happened in 2016 but did not. So I think now you have a) again some lack of transparency how market would react to who wins WH assuming quick decision, and b) Senate control and election outcome delay/controversy could generate serious market moves.

To some degree this is visibly 'priced in' in the sense that current choppiness and relatively high VIX probably is partly a reflection of the coming US election, although there are other reasons as there always are (COVID uncertainty worldwide, whether tech stocks got too far ahead, etc)

I do look at trend measures based on VIX and momentum at least marginally in rebalancing. If my equity allocation goes over target due to market rally in a low VIX uptrend I might let it ride. In this environment I strictly sell if over target enough to justify a one contract futures trade.

[tesuzuki2002]

Investors fear US election won't be decided for weeks -- or even months - CNN

[link formatted by admin LadyGeek]

[H-Town]

I know, I know: Time in the market, not timing the market.

BUT:

I have some new cash (about 6% of total portfolio) and I'm curious whether anyone else is waiting until after the US election in 45 days?

No. For 2 reasons:

1) I don't know how the market would react. And I don't trust that anyone would know either.
2) 6% of portfolio is small enough that I don't really care one way or the other.

[Robot Monster]

https://www.cnn.com/2020/09/21/investin ... index.html

The article starts off, "Investors are trying to figure out what's ahead for the stock market...," and that, folks, is what the problem is. Might as well be, " Investors continue banging their head against the wall hoping to gain insight... "

[burritoLover]

If you believe the markets will be volatile due to the upcoming election, then you buy before the election not after all the uncertainty has been removed.