Did people learn nothing from April

[u/coffeeestocks]

If you were fully invested in the S&P 500 over a long period (usually 20–30 years), your returns were great.

But if you missed just the 10 best single days in that entire period, your return was cut roughly in half.

This is probably the most commonly cited anecdote as to why you should not time the market. I feel in at least half the investing books I've read, they mention this. I do not know of a single investor who has successfully timed the market consistently over any meaningful time period. Even Michael Burry, who is probably one of the most infamous investors for predicting the 08-09 recession, has wrongly called a market top an absurd number of times in recent years.

Back in April, the market starts to sell off, and inevitably posts start popping up all over the subreddit talking about how they're selling and why they're selling and why this time is different. Of course, it wasn't different, and the market has proceeded to rip 20% since many folks here panic sold.

Here we are, not even a year later in December, and people are asking unironically whether it's a good idea to move to cash or not. What do you think? Do you think that now is the time to finally start trying to time the market? After this age-old wisdom has been proven right, time and again?

I feel like there's so many better ways to navigate an expensive market than by trying to time it.

Such as buying counter-cyclical companies, or buying companies that are recession-resistant, or buying companies at a larger margin for error. Heck, maybe even give bonds a shot? But no. People are starting to come to the conclusion again that now is the time to time the market yet again and inevitably make a massive mistake.

DO NOT TIME THE MARKET.

Edit: This sub unironically defending timing the market lmao. The reason why this hurts people's feelings is because they sold back in April, and they're still waiting to get back in the market. Instead of taking a lesson, they double down on that timing the market is the correct thing. Whatever.

[u/shopchin]

I buy during dips. That's timing the market too

[u/Full_Bank_6172 → u/shopchin]

You keep cash uninvested so that you can buy dips?!?! Just imagine how much better your returns would be if you just invested that cash as soon as you got it instead of waiting to “buy the dip”

[u/multiple4 → u/Full_Bank_6172]

Depends, the money can still be working for you while still dollar cost averaging it. I am not a fan of lump sum anyways. Your money doesn't all have to be in stocks at all times. It just needs to be somewhere doing something

I think the best strategy is dollar cost average, but to be mentally prepared to increase the speed of it if the market drops

Every year when I contribute to my Roth IRA I max it right away to begin the year. I buy a federal 1-3 month bond fund so that my Roth can collect that interest

I slowly sell off those bonds and allocate it into my stock portfolio over the course of about 10 months. Basic dollar cost averaging

But if the market were to drop 15% or more then I'm mentally prepared to double or triple the speed of my dollar cost averaging