How do you invest the money you make?

[trad1ngbull]

When I started this thread, I was in a personal phase where I was optimizing my risk control and diversifying in case something serious happened with the global economy.

At no time was trading being suspended on Betfair even a chance for me. On the contrary, Betfair would always be my focus if the economy had problems.

Less than a month passed and here we are... The global economy heading into a deep recession and Betfair completely on halt.

[firlandsfarm]

Less than a month passed and here we are... The global economy heading into a deep recession and Betfair completely on halt.

So it's all your fault!

[arbitrage16]

If you are working to a longer time frame, then you sit and hold, wait for things to get really bad, and then begin to buy slowly back into the market.

based on ongoing market sentiment, i'm sticking with my (personal) opinion from last week (before the big falls), that I would have exited on a stoploss and waited until the markets/ecosystem/social fabric in general had stabalised, rather than continuing to hold while things are falling. I'd (theoretically) wait until it's gone the further 30-40-whoknows% that it will and then buy back in once consolidation begins. you'd still be up on today's (or last week's) prices.

In short, i still agree with your closing statement, but agree to disagree on the former.

anyway, purely my very personal opinion and more a note to remind myself in the weeks/months ahead.

So you're going to time the market? Which is what everyone tries to do, so what makes your approach different? Buy low sell high, simple right? But it's a lot different, as we all know, when money/emotion is involved...which you have admitted, if I recall correctly, you don't have in the market right now. All very well sitting on the sidelines and saying what you would do, but it's probably not what you'd do when money is on the line.

[arbitrage16]

Haha, you couldn't make it up. As if by magic, Euler has posted the data on the percentage of traders who lose in financial markets:

viewtopic.php?f=35&t=20748

[arbitrage16]

Please remember to come back and tell us when it seems to have stopped falling and we should start buying at the cheap levels.

Are you different to Arbitrage16 or a fake account … the two of you seem to have the same basic grudge on your shoulders and the same style of argument (or perhaps it would be more correct to say the same lack of style). Anyway my message to you is the same as to him/her … BYE

The rationale behind this post seems to be 'it's not possible to have two people disagreeing with me, must be a fake account'

That highlights, once again, the quality, or lack thereof, of your thinking, and thus is it any wonder that you adopt such an outdated perspective on financial markets

[jimibt]

If you are working to a longer time frame, then you sit and hold, wait for things to get really bad, and then begin to buy slowly back into the market.

based on ongoing market sentiment, i'm sticking with my (personal) opinion from last week (before the big falls), that I would have exited on a stoploss and waited until the markets/ecosystem/social fabric in general had stabalised, rather than continuing to hold while things are falling. I'd (theoretically) wait until it's gone the further 30-40-whoknows% that it will and then buy back in once consolidation begins. you'd still be up on today's (or last week's) prices.

In short, i still agree with your closing statement, but agree to disagree on the former.

anyway, purely my very personal opinion and more a note to remind myself in the weeks/months ahead.

So you're going to time the market? Which is what everyone tries to do, so what makes your approach different? Buy low sell high, simple right? But it's a lot different, as we all know, when money/emotion is involved...which you have admitted, if I recall correctly, you don't have in the market right now. All very well sitting on the sidelines and saying what you would do, but it's probably not what you'd do when money is on the line.

in short, yes, based on common sense, i've got no position in the markets of any sort at presnt. based on the same rationale, i'll sit it out and wait for consolidation, be that 6 days, 6 weeks or 6 months. but i do wholeheartedly agree that if my money was still on the line, i may/would think differently. that said, i'm an anal type and have observed boom 'n bust and black mondays of the past. i'm ALMOST immune to cashing out on lossess between 15% and 35% with a view to sensibly balancing risk and reward for re-entry. for now, it's definately time to be out and wait -unless you can afford it and your losses are so blindingly hard to accept.

[sa7med]

I just started my first ISA and will be looking in to investing in the coming months, probably around when COVID-19 nears the peak of infections. I'll put a large portion (around 90% in an index ETF, probably S&P500) and with the rest I will make some speculative bets. When the interest rates go up I'll likely buy some bonds also.

Curiously, I was reading Nassim Taleb's book 'The Black Swan' as the virus unfolded in Europe. Highly recommended read and very relevant today. A bit repetitive but I think a great intro to investing. Currently reading "The Misbehaviour of Markets" by Benoit Mandelbrot, who seems to inspire much of Taleb's thinking.

[Euler]

I was fortunate enough to have lunch with Benoit. It only happened as I was meeting somebody who was meeting him and his original guest couldn't make it. I wish I had known more about his work before we met.

[sa7med]

I was fortunate enough to have lunch with Benoit. It only happened as I was meeting somebody who was meeting him and his original guest couldn't make it. I wish I had known more about his work before we met.

Wow! One on one lunch?! That's very fortunate indeed. I think he's quite the unsung titan. Did you talk about gambling markets at all? Curious what he had to say.

[trad1ngbull]

Curiously, I was reading Nassim Taleb's book 'The Black Swan' as the virus unfolded in Europe. Highly recommended read and very relevant today.

Fooled by Randomness (2001) was his first book and is my favorite.

I recommend to read all books of his "Incerto Series". Yes, Taleb is repetitive sometimes, but his books really worth the effort, even if you disagree with him on some points.

I was fortunate enough to have lunch with Benoit. It only happened as I was meeting somebody who was meeting him and his original guest couldn't make it. I wish I had known more about his work before we met.

What a small world we live in.

[ShaunWhite]

What a small world we live in.

Sometimes it doesn't take all six degrees of seperation I guess. But at times like this, even six seems too close for comfort. https://en.m.wikipedia.org/wiki/Six_deg ... separation

[ShaunWhite]

Decent little FTSE bounce today, still hard to contemplate it was nudging 7,500 this time last year.

[PDC]

Why timing the market is so hard:

Stock market news live: Dow posts best weekly gain since 1938, despite Friday drop

Steep gains made earlier in the week still sent the Dow up a total of 12.8% for the week, for its best weekly gain since 1938. The S&P 500 rose 10.3% for its best weekly gain since 2009.

https://finance.yahoo.com/news/stock-ma ... 09874.html

While also this week:

Record number of Americans file for unemployment

Nearly 3.3 million people registered to claim jobless benefits for the week ended 21 March, according to Department of Labor data.

That is nearly five times more than the previous record of 695,000 set in 1982.

https://www.bbc.co.uk/news/business-52050426

To those on here that are able to time the market twice, both when they sell and buy hats off to you. But:

Suppose you did get spooked last year, and you gave up by selling off your positions, trading your investments for cash. Eventually you'll get back in the market when the worst is over, you tell yourself. That sounds like a reasonable strategy. However, waiting it out also means potentially missing some very big up days in the market, which makes an enormous difference in your portfolio's performance over time.

Time in the market, versus time out of the market - J.P. Morgan Asset Management's 2019 Retirement Guide shows the impact that pulling out of the market has on a portfolio. Looking back over the 20-year period from Jan. 1, 1999, to Dec. 31, 2018, if you missed the top 10 best days in the stock market, your overall return was cut in half. That's a significant difference for only 10 days over two decades!

You don't have to miss many good days to feel the impact. The return went from positive to negative by missing the 20 best days of the market over 20 years.

https://www.fool.com/investing/2019/04/ ... he-st.aspx

[ShaunWhite]

Why timing the market is so hard:

It's why institutional investors prefer to hold assets for either 20yrs or 20 nanoseconds, anything between that is tough going.

[PDC]

based on ongoing market sentiment, i'm sticking with my (personal) opinion from last week (before the big falls), that I would have exited on a stoploss and waited until the markets/ecosystem/social fabric in general had stabalised, rather than continuing to hold while things are falling. I'd (theoretically) wait until it's gone the further 30-40-whoknows% that it will and then buy back in once consolidation begins. you'd still be up on today's (or last week's) prices.

+1

You don't blindly invest each month just because it's the day you invest. You take the market conditions into account … not day to day but by trend. If the market is reasonably stable then carry on as normal but when you see it is in a Bear market you hold back your new money until it seems to have stopped falling and you can buy cheaply.

Please remember to come back and tell us when it seems to have stopped falling and we should start buying at the cheap levels.

Are we still holding off buying into the market, assume so as we haven't yet had the nod to get back in?

Off the lows the markets are:

FTSE100: +19.3%
FTSE250: +32.6%
S&P500: +27.3%
Dow: +30.2%

Damn that dollar cost averaging approach and not trying to time the market, I am glad I ditched it and avoided buying in at the lows as the trend was for it to keep on going down

(P.S. I am not saying it won't fall again and won't fall further than it did before. All I know is that it will either go up, down or stay the same. Though in 20+ years time the markets will more likely than not be higher than they currently are. What stocks will be higher I don't know either, many won't even exist anymore. That is why I don't try to pick the winners and time the market.)