2kids10horses
Senior Member
Joined: Dec 20, 2010 20:15:09 GMT -5
Posts: 2,759
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Post by 2kids10horses on Apr 16, 2011 22:00:12 GMT -5
wxyz,
Read my post. I said martket timing is not for most people. I didn't recommend it. I suggested that the OP dollar cost average long term investments.
Just so you know, market timing is not trying to predict the absolute tops and bottoms. I agree, that's impossible. I just try to stay on the right trend. If the market is going up, I buy. If it's going down, I sell short. I don't expect to call tops and bottoms, and I get whipsawed a lot.
One more comment about Buy and Hold: Every stock will need to be sold at some point. I don't know of any "Buy and never sell" stocks. Think Enron. GM. Lucent. Eastern Airlines. Blockbuster Video. These stocks needed to be sold before they became worthless. Long before. So, a simple "buy and hold" strategy is just TOO simplistic. You have to have a "sell" component in the strategy. You have to reap winners and avoid massive losses.
About academic studies. Fun reading. But, just ask the boys over at Goldman Sachs. Do you think they would believe you can't make money trading?
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TD2K
Senior Associate
Once you kill a cow, you gotta make a burger
Joined: Dec 19, 2010 1:19:25 GMT -5
Posts: 10,931
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Post by TD2K on Apr 17, 2011 11:35:47 GMT -5
I'll go through periods where I might check the balance daily and then spend months never looking at it. I don't keep that close of an eye on the market. When they just say "the market closed up (or down) xx points" it tends to drive me nuts because I don't know if they are talking the DOW at 12,000 or 10,000.
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stats45
Established Member
Joined: Dec 27, 2010 16:52:12 GMT -5
Posts: 415
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Post by stats45 on Apr 17, 2011 11:48:59 GMT -5
Timing can be very profitable, but most people don't have the time, information, or patience to make it work. Relatively few investors (that I know of) try to time the entire market, but the focus on a section of the market they know extremely well. I know two 'quants' from graduate school who model and invest in small areas of the market with relative success. They declined offers from finance/banking firms, but they are doing well so far.
I just don't think that many people appreciate how carefully professional investors pour over the relevant data, compare this data with information from comparable companies, model economic growth, etc. People like to mock the financial industry as speculation and emotion (and it is true that these things impact prices), but there is a tremendous about of information and wisdom about our economy reflected in the stock market and much of that is the cumulative research and work of professional investors making well-informed decisions about prices and purchases.
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midjd
Administrator
Your Money Admin
Joined: Dec 18, 2010 14:09:23 GMT -5
Posts: 17,719
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Post by midjd on Apr 18, 2011 9:06:58 GMT -5
I'm glad I started this thread... your responses are helping me weather today's bloodbath without even breaking a sweat (And I am *NOT* checking my balances again til the end of the week!)
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midjd
Administrator
Your Money Admin
Joined: Dec 18, 2010 14:09:23 GMT -5
Posts: 17,719
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Post by midjd on Apr 18, 2011 11:54:28 GMT -5
wxyz!
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souldoubt
Senior Member
Joined: Jan 4, 2011 11:57:14 GMT -5
Posts: 2,745
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Post by souldoubt on Apr 18, 2011 12:08:45 GMT -5
I watch the market daily but that's more due to the company I work for and my own curiousity. I only see my accounts when I update balances 1-2 times a month after contributions. If you watch your accounts daily you can drive yourself crazy and that's exactly what happened to a family member of mine. You're in it for the long haul so I wouldn't sweat the little things (daily) but to each his or her own.
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