When to get back into market?

User Forum Topic
Submitted by moneymaker on January 7, 2016 - 6:42am

I don't know if it really matters when I got out of the market, the question now is when to get back in. Because at some point I do want back in. Anybody have sophisticated software out there that predicts a bottom? Futures are down like 372 or something so I'm thinking it's not time yet. Just looked it up and I got out 10/23/15.

Submitted by livinincali on January 7, 2016 - 8:12am.

When everybody tells you not to buy and they've all gotten out.

Submitted by Coronita on January 7, 2016 - 8:17am.

I think my days of trying to individually stock pick is over. What I have done is simply take my $3000/month that I use to pay towards a mortgage and impound account and now do a direct deposit into my vanguard account, where it gets auto invested into 5 vanguard index funds covering the total stock market, total international stock market, a tax exempt bond fund, and a money market fund.

That, and I make sure to max out my employee stock purchase and plan on selling immediately to get that 20% gain.

Submitted by The-Shoveler on January 7, 2016 - 8:20am.

We started a PowerBall fund at work so I am just going with that and staying out of the market,

Just kidding sort of.

Submitted by XBoxBoy on January 7, 2016 - 9:02am.

moneymaker wrote:
Anybody have sophisticated software out there that predicts a bottom?

Let me assure you that if someone does have sophisticated software that predicts market bottoms with any worthwhile degree of accuracy they are not going to share it with you or me.

Also worth mentioning, a lot of very smart people have worked very hard on trying to develop AI algos that predict market movements of more than a couple minutes away, and to the best of my knowledge all of that has been for naught so far.

There is an argument that when predicting the future your uncertainty goes up exponentially with time. This would explain why high frequency trading is possible with computers but long range trading is not. I'm not totally convinced this is true, but I'm also don't want to bet much that it is false.

Submitted by cvmom on January 7, 2016 - 9:37am.

flu wrote:
I think my days of trying to individually stock pick is over. What I have done is simply take my $3000/month that I use to pay towards a mortgage and impound account and now do a direct deposit into my vanguard account, where it gets auto invested into 5 vanguard index funds covering the total stock market, total international stock market, a tax exempt bond fund, and a money market fund.

That, and I make sure to max out my employee stock purchase and plan on selling immediately to get that 20% gain.

Scary. This is almost exactly what I do, practically word for word!

Submitted by deadzone on January 7, 2016 - 10:18am.

Look at a chart of the two most recent market crashes, in 2000 and 2008-9.

When the market crashes, it's going WAY DOWN. A few hundred point drop on the Dow any given day is a drop in the bucket in the big picture.

Submitted by Coronita on January 7, 2016 - 10:48am.

cvmom wrote:
flu wrote:
I think my days of trying to individually stock pick is over. What I have done is simply take my $3000/month that I use to pay towards a mortgage and impound account and now do a direct deposit into my vanguard account, where it gets auto invested into 5 vanguard index funds covering the total stock market, total international stock market, a tax exempt bond fund, and a money market fund.

That, and I make sure to max out my employee stock purchase and plan on selling immediately to get that 20% gain.

Scary. This is almost exactly what I do, practically word for word!

I've given up trying to predict the markets. Looking at how my passive portion of my investments performed versus active investment in the stock market (both trying to time the long and short) it was clear that my passive investments performed better over the years, simply because of consistently investing small chunks every month, both when its low and high.

Also, you can't beat a 20% guaranteed return from.an employers espp.

My bigger problem is the much bigger tax bill I will have now that I can no longer write off a mortgage interest deduction.

That tax bill from the w2 paycheck is not going to be pretty. Fortunately I won't have any rsus vesting for some time.

Alsoy writeoffs from rentals is getting smaller too. No mortgage interedt deduction on most of them.

Oh well. First world problems..heh heh.

Submitted by livinincali on January 7, 2016 - 11:16am.

deadzone wrote:
Look at a chart of the two most recent market crashes, in 2000 and 2008-9.

When the market crashes, it's going WAY DOWN. A few hundred point drop on the Dow any given day is a drop in the bucket in the big picture.

The problem is those crashes started from a a couple 2% down days that were no big deal. That's the problem with trying to time the top of a market. At the onset it looks like a bunch of no big deal corrections. Next thing you know you're down 20% and don't want to sell until things go back up. So you hold everything all the way down and sooth yourself with the tried and true you can't time the market, it will always come back, and nobody could have seen this coming.

We'll see what happens this time, but I expect most people to get caught in the next crash the same way they got caught in the previous two. Fear of missing out of the upside overwhelms their ability to take profits and wait for better opportunities.

Submitted by moneymaker on January 7, 2016 - 1:49pm.

If China doesn't open their markets tomorrow it will be like in the movie "it's a wonderful life" when they were trying to stay solvent until closing time. I suspect tomorrow the jobs numbers will be good but the story will be China's Yuan/Dollar ratio. I wanted to get back into the market today but I think I'll wait.

Submitted by La Jolla Renter on January 7, 2016 - 6:00pm.

Buy back in 20% chunks all the way down. Make a chart or spread sheet and stick to it.

I got out about the same time you did. Not sure when I am going to go back in. But going to do the above and try to take the emotion out of it.

My plan will also have set points to sell again if the market goes back up.

Submitted by moneymaker on January 8, 2016 - 12:21pm.

Will the day end up or down? China I believe ended up but Europe ended down, go figure.

Submitted by moneymaker on January 8, 2016 - 2:08pm.

Looks like a down day, heard the Chinese government was buying while individual investors were selling. Does the US government do this? I would not think so, but what do I know. Anyway I'm back in and feeling wishy washy. As far as futures are concerned are those pending orders or contracts? I've always assumed orders since the market last closed.

Submitted by dumbrenter on January 9, 2016 - 2:44pm.

My sophisticated software predicts the following with 100% certainty : The dow on Dec 31 2016 will not be the same as the dow on Jan 1 2016.

Submitted by paramount on January 9, 2016 - 5:12pm.

We've been living in an economic fantasyland for years.

"We Frontloaded A Tremendous Market Rally" Former Fed President Admits, Warns "No Ammo Left"

http://www.zerohedge.com/news/2016-01-05...

Or just watch the video:

https://youtu.be/7nuzT3rchPU

Submitted by moneymaker on January 9, 2016 - 7:02pm.

Why is it that people have to leave an organization before they can say what they really feel/think.

Submitted by Coronita on January 9, 2016 - 7:11pm.

I'm still amazed that doomsayers exist on this board despite all the years of what we've gone through and years and years of how the Fed are expert can kickers.

Warning: adopting a doomsayer viewpoint can be hazardous to one's financial health. It's almost as destructive as being a perma-bull.

Submitted by paramount on January 10, 2016 - 7:55pm.

flu wrote:
I'm still amazed that doomsayers exist on this board despite all the years of what we've gone through and years and years of how the Fed are expert can kickers.

Warning: adopting a doomsayer viewpoint can be hazardous to one's financial health. It's almost as destructive as being a perma-bull.

I believe you may have a negativity bias. This is about data, not doom.

Things that are said that may be contrary to your beliefs (political or otherwise) are not necessarily negative.

This a former (recently) fed official telling you the fed is running out of options.

This is a fed official telling you the fed goosed the markets.

It is what it is...

Submitted by The-Shoveler on January 11, 2016 - 6:41am.

flu wrote:
I'm still amazed that doomsayers exist on this board despite all the years of what we've gone through and years and years of how the Fed are expert can kickers.

Warning: adopting a doomsayer viewpoint can be hazardous to one's financial health. It's almost as destructive as being a perma-bull.

I was talking to a trader at BlackRock this weekend (don’t ask how),
She was saying the whole china devalue thing and the Shanghai market sell off is way overblown and it is really just a normal adjustment to the dollar strength (much as the Greece situation was overblown), (Just makes great headlines and sells news feeds).

Submitted by Coronita on January 11, 2016 - 6:43am.

paramount wrote:
flu wrote:
I'm still amazed that doomsayers exist on this board despite all the years of what we've gone through and years and years of how the Fed are expert can kickers.

Warning: adopting a doomsayer viewpoint can be hazardous to one's financial health. It's almost as destructive as being a perma-bull.

I believe you may have a negativity bias. This is about data, not doom.

Things that are said that may be contrary to your beliefs (political or otherwise) are not necessarily negative.

This a former (recently) fed official telling you the fed is running out of options.

This is a fed official telling you the fed goosed the markets.

It is what it is...

No offense, but I recall a time when you were telling people how horrible it was to own a home in temecula and how the world iin riverside was crashing down to an abss, and then when prices started going up, you quickly flipfloppd your opinion. So i don't think any of that was based on data, but rather emotions.

Submitted by Coronita on January 11, 2016 - 6:47am.

The-Shoveler wrote:
flu wrote:
I'm still amazed that doomsayers exist on this board despite all the years of what we've gone through and years and years of how the Fed are expert can kickers.

Warning: adopting a doomsayer viewpoint can be hazardous to one's financial health. It's almost as destructive as being a perma-bull.

I was talking to a trader at BlackRock this weekend (don’t ask how),
She was saying the whole china devalue thing and the Shanghai market sell off is way overblown and it is really just a normal adjustment to the dollar strength (much as the Greece situation was overblown), (Just makes great headlines and sells news feeds).

well, again, I think erroring on the side of caution isn't a bad thing. Just don't let the negativity lead you down a rat hole. How many people here were expecting 50% off in Carmel Valley/Del Mar/LJ after already seeing a 25% decline? And yet they still waited for an additional 50+%?

None of this really matters over the longer period if I think you just remain consistent.

Submitted by poorgradstudent on January 12, 2016 - 5:21pm.

Now looks pretty good. Seems the knife has finished falling. Unless this is a dead cat bounce?

Submitted by scaredyclassic on January 12, 2016 - 5:35pm.

I try to eat most of our veggies before I get back in the market.

Submitted by spdrun on January 12, 2016 - 6:34pm.

Unless this is a dead cat bounce?

Let's hope so. Chaos is opportunity.

Submitted by paramount on January 12, 2016 - 9:40pm.

"Sell everything."

That harrowing advice is from The Royal Bank of Scotland, which has warned of a "cataclysmic year" ahead for markets and advised clients to head for the exit. Do not wait. Do not pass go.

Submitted by spdrun on January 12, 2016 - 10:08pm.

Scotland might be brave, but it's not always right.

Submitted by poorgradstudent on January 13, 2016 - 9:21am.

paramount wrote:
"Sell everything."

That harrowing advice is from The Royal Bank of Scotland, which has warned of a "cataclysmic year" ahead for markets and advised clients to head for the exit. Do not wait. Do not pass go.

Cool. Once we get a couple more of these it's a good indicator it's time to buy.

Submitted by Coronita on January 13, 2016 - 12:35pm.

Thank god I paid off my house instead if staying in the markets completely.

Maybe I'll move back in in Feb or March.

Submitted by deadzone on January 13, 2016 - 12:52pm.

poorgradstudent wrote:
paramount wrote:
"Sell everything."

That harrowing advice is from The Royal Bank of Scotland, which has warned of a "cataclysmic year" ahead for markets and advised clients to head for the exit. Do not wait. Do not pass go.

Cool. Once we get a couple more of these it's a good indicator it's time to buy.

Buy the dip. Go all in RIGHT NOW!

Submitted by The-Shoveler on January 13, 2016 - 12:59pm.

flu wrote:
Thank god I paid off my house instead if staying in the markets completely.

Maybe I'll move back in in Feb or March.

Good for you flu, It looks like no one is buying stocks, they are buying powerball tickets instead.

Our powerball fund at work hit an all-time high LOL.

I am still out of the market unless we get a 35-50% decline then I will start to move in again, But I don't think that will happen, not seeing what everyone else is maybe but I see no good reason for the sell off.

But at the same time I don't see a good reason for it to go up much either.

Submitted by XBoxBoy on January 13, 2016 - 1:14pm.

moneymaker wrote:
Anyway I'm back in and feeling wishy washy.

How you feeling now? Are you still back in or did you get back out?

Today is a great example of why I don't like to actively trade. This morning things looked ok. And then things just fell apart. Oh well...

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