Timing the Market exposed
ฝัง
- เผยแพร่เมื่อ 23 ส.ค. 2024
- What would happen if you were able to time the stock market perfectly and buy at the bottom of the last 5 stock market crashes? In this investing for beginners video, you'll learn something very important for long term wealth creation.
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Video resources:
Spreadsheet:
docs.google.co...
Resources:
SP&500 historical data:
www.econ.yale.e...
Market-timing newsletters study:
www.nber.org/s...
Market timing paper:
caia.org/sites...
Special thanks to my incredibly beautiful, smart, and creative girlfriend, Stephanie, for her editing wizardry and creative insights and ideas. Although you do not see her speaking to you in the videos, believe me, she has poured her heart and soul into making this video and the videos on this channel. It's been a 50/50 effort. I don't want to even imagine what these videos would look like without her hard work and creative insights. Thank you.
Disclaimer:
These youtube videos and content are for entertainment purposes only. If stocks or companies are mentioned, Richard may have an ownership interest in them -- DO NOT make buying or selling decisions based on Richard’s videos. All information contained herein should not be construed as anything other than an opinion for entertainment purposes only. Information being provided may be outdated or inaccurate; it is your responsibility to verify all information.
No financial advice is being given nor is any other advice of any kind. You should consult with a qualified professional where appropriate and before any action is taken on this video. No liability or damages shall take place because of this video and/or content.
There is no express or implied representations or warranty with respect to the accuracy or completeness of the content of the videos, including any content, description, links, or resources shared, including those by third parties. Furthermore, all parties specifically disclaim any and all express or implied warranties of merchantability or fitness for a particular purpose. By watching this and all related videos, you agree to be bound by this disclaimer.
#StockInvesting #StockMarketForBeginners #ValueInvesting
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Here's another video to watch next that compliments this one very nicely, enjoy!: th-cam.com/video/n9BVsvlGUC0/w-d-xo.html&ab_channel=RichardHopkins
Wow, so automatic investing outperforms impossibly perfect market timing. Excellent vid dude.
Glad you liked it! Thanks Will!
Great video Richard, Iam the consistent Chris 😀, my favourite quote about timing the Market: “Time in the Market is more important than timing the Market”
Yes! It’s perfect.
Well as long as you have a diversified portfolio closely to the s&p 500 then is good.
Else Timing is perfect😊
This was by far my favourite one so far
Awesome! Ya this one turned out great and has info that id useful for almost everyone :) thanks for commenting and watching :)
This video is very eye opening! Thanks for sharing. I’m older now, but I guess it’s not too late to start with the consistency approach.
I’m really happy you enjoyed it Sharetha :) thanks for leaving the comment :)
Super interesting studies/examples you have used to validate the power in investing your hard earned money monthly and watch it grow! You should teach this to the high school kids that have part time jobs. $200 month at a young age sets them up for life! Awesome job!
Thanks!!! Glad you enjoyed. You’re right!
Corporate earnings go up more often than down so it makes sense to be invested more than being on sidelines. If earnings didn’t go up so many of us would be out of a job. Great video!
Great point! Thanks for your support :)
Great content! Thanks for your great work mate. You've got my like and subscribe.
Much appreciated!!! 🙏🙏
Great & clear concepts
Thank you! Glad you enjoyed. Thanks for your comment and support :)
Love this video! I’m Chris :) everyone except my brother tells me it’s wrong and glad it’s actually the right way!
Amazing :) Keep it up :) Thanks for your comment!
Agree, just buy good quality dividend paying companies, and hold long term. I only trade my golds, buying them when they are out of favour and selling them at the height of whatever panic is gripping the market.
Perfect 👌 Thanks for your comment and support!
This was fantastic - thank you!
You're very welcome! Glad it was helpful. Thanks for your support :)
Good stuff as usual. Appreciate that
My pleasure!! Thanks Joey for your support :)
This is by far the best video about DCA I’ve seen. It convinced me to start investing every single month!
Awesome ! very happy to hear that :)
Great work!
Thanks!
Richard your advise is very sound. It is crazy that so many people still think they can time the market!
Dollar cost averaging into a diversified group of funds is the way to become wealthy.
Good stuff, keep it going and you will be helping all your subscribers. (Unless of course they start getting greedy)
Jim
Well said! Thanks very much :)
Great content, man. Love it🙏
Thanks! Glad you liked it :)
Thanks for all your videos sir. Gold!
My pleasure François, glad you like them!! :) Thanks for your support!
Amazing video, I like and sub
Thanks very much! Glad you enjoyed. Thanks for your comment and support!
wow this is insane! i'm surprised too
I know! I was shocked!
Richard Hopkins interesting and useful video.
Point taken that being in the market is more important than sitting on the sidelines if we have no knowledge of crashes and peaks.
However, you completely left out some important cases: people that sold at or near the peaks and bought after the drops. It’s untrue that we never have any knowledge or insight into what the market will do.
Market timing isn’t just about when you buy but when you sell.
Absolutely you're right. I just think it would be impossible to pull it off, especially long term. And I wanted this one to be more directed towards the audience of people who don't want to attempt to time the market anyways. I've got lots of friends like that. They want to invest but they don't want to do any work. For them and for a large portion of the population it's a good passive way to go. The second study mentioned does kind of address this because it shows what would happen if you missed the 25 worst days, which would mean selling to avoid them. Still though it's more of a fantasy than a long term plan you can use. Thanks for leaving a comment and supporting me, I appreciate you :)
Hi, does this strategy (DCA) work for individual stocks as well? Let's say I have around 10 individual stocks in my portfolio and want to distribute $1000 monthly equally among them (some may be whole shares, some fractional depending on the price). Is it better to wait for them to decrease in price or DCA works just as well?
With my index funds, it's really easy for me to DCA, but when I see price changes on my individual stocks, I hesitate and feel there's a "better" time to invest the money, but at the same time, I know consistency is key. Thoughts?
In my opinion it's the same. Essentially that's all you're doing with the index funds but it's spread out over 500+ stocks instead of 10. HOWEVER: since you're not valuing companies using this method, much more than 10 would probably be best. Owning just 10 companies or less is more for the people who are valuing companies and buying at bargain prices. The less you know about each company and what it's worth, the more diversified you should me. The more you know about the company and the more confident you feel about what it's worth, the lower the number of stocks you should own. At the end of the "easy-mode" video I did suggest a stock alternative to the SP500 index fund that could be used for DCAing :)
@@IntelligentStockInvesting Ok I believe I understand. I'm just starting out practicing how to calculate intrinsic value, so having more companies makes sense for now. As I improve, I should feel more confident in having just a few companies in my portfolio. Thank you for your detailed response.
@@kara-mariehall5691 Yes, you got it! that's what I did as well. I'm happy to help answer future questions as they come up, and it helps me too (by giving me ideas for future content) so don't worry about bugging me, and don't worry about thinking it's a silly question or anything like that. I appreciate the comments! :)
Great video
Thanks! Glad you enjoyed it. Thanks for your support :)
Just got a new subscriber thanks for the info
Awesome, thank you! Glad you enjoyed it!
Nice quality 😮
Thanks!!
your content is great!
Glad you think so! Thank you!
Great video. I guess the professors from Yale were incorrect in their book “Master the market cycle”. Well I will leave it there.
Trying to time the market becomes even more silly when you realize that the stock market is the greatest wealth building tool there is once you understand how it works: It gives you the opportunity to make fractional-ownership-interest purchases of business at prices dramatically cheaper than they would command in negotiated transactions involving entire companies. Why? Because the participants setting the price in this auction-pricing system sometime behave like a manic-depressive lemmings.
@@IntelligentStockInvesting
I think if you read the book you might understand market cycles more. If you go by the papers you quote 5 of the largest increase happened in 2008. In 2008 the market was down 37%. If you would have followed the trend you would have made 67% by investing in other opportunities in 2008.
Not saying get out of the market, timing the trend even by weeks gets you better returns. Sorry to point this out. It's following market cycles not timing.
@@KCInferno hindsight is 20/20. What is the name of the author? I will read your book.
Great stuff!
This should be applicable for stocks that have a durable competitive advantage right? We can dollor cost average it monthly irrespective of margin of safety / intrinsic value?
Thanks Arun, sorry for the delayed response! Perhaps yes however that's also hard to say. Some of these stocks might be more often over valued and very briefly and rarely undervalued. I would probably use the dollar cost average approach with a equally weighted index fund (for reasons that are explained in this video: th-cam.com/video/5iWxCUHZEbE/w-d-xo.html ) OR to your point, I would identify a list of companies that have a durable competitive advantage and I would be okay with owning forever, and dollar cost average into those, but choosing the 1-5 of them that are currently priced the most fairly/undervalued by the market. This video here somewhat elaborates on that process: th-cam.com/video/46OIdfGaK-Q/w-d-xo.html Thanks for commenting!
@@IntelligentStockInvesting Thank you for the response. You are a real value creator, keep going
Awesome video! Well explain and love the visuals! Keep em coming! I’ve been waiting for the market to crash before entering 😩... I guess it’s time to learn from my mistakes 🤪
I’m glad you enjoyed it!
You’ll like this video too I think on index funds if that’s the route your thinking of taking vs. Picking individual stocks th-cam.com/video/5iWxCUHZEbE/w-d-xo.html
My girlfriend Stephanie edits all of them so thank her for the visuals :)
@@IntelligentStockInvesting Great job Stephanie!! 👏✅👍👏
@@IntelligentStockInvesting I’ll check it out: I’ve decided to go
manly index/ETF’s 👍✅👍 Thanks so
Much!
Misleading. I would like to see a fourth player actually buying low and selling high. So buy at the dip, sell at the high, place in bank account. Then invest all of that money into buying the next dip, rinse and repeat.
Without a crystal ball this would be impossible unfortunately. Trying to sell before the market crash would result in frequently selling too soon, and guessing where the bottom is would result in again buying too soon, as well as too late. Trying to time the market like this is a fools errand unfortunately. People will try to convince you their technical analysis indicators/system will work to allow you to time the market but if that were true they wouldn't need to make money by selling it to you. It's easy to look at a price chart and point to the spots you'd have bought and sold but in practise it's impossible. I make videos for investors on here so discussing a fantasy of being able to time the market wasn't relevant - there are plenty of market timing gurus out there with youtube channels out there and services with a monthly fee that will be happy to have you join them :) You're right though. Impossibly perfect market timing would achieve ridiculously perfect results!! Thanks for your comment :) If you want to learn more about investing in the way that Warren Buffett and other value investors think about it and do it, check out this video :) th-cam.com/video/EcPZJpIGYcc/w-d-xo.html
That's simply warren buffet
What would you say about the studies that show lump sum investing beating DCA more than 2/3 of the time? I believe Vanguard has done such a study.
If you get let’s say $100k from an inheritance or something I do not think that you should divide that by 12 and slowly invest it over 12 months. I think you should just invest it all when you get it. The distinction here is that I do not think you should try to guess the top of the market and sell your stock with the plan of buying back in at the bottom.
what about jim simons
Both Value and technical analysis type factors play into the Jim
Simons investing strategy and my understanding is that it’s programmed and rule based not emotional. What I’m talking about in this video is more concerning the vast majority of people who have no concept of underlying value and make decisions based on emotions of fear and greed.
*there are* market timing billionaires. See James Simons, or the ones behind Two Sigma or Citadel...
I'll look into this more when I get some time soon because I'm not familiar with Two Sigma or Citadel yet, however, I do consider Simons to be a value investor, just a heavily quantitative one, not a market timer :) Thanks for commenting I appreciate you :)
"If it looks like a duck, walks like a duck, quacks like a duck..." No we value investor never time the market, meanwhile only buy when the market fail big.
😎
Time in the market beats timing the market every time. If anyone could time the market active funds would routinely beat index funds but they rarely do. Plug that full 98k in at the start of 1980 and see how that does!
Nailed it 🙌🙌
Great Content , Will suggest you to upload a video twice a week. To get more subs
I will try my best to start doing more than one a week!
Seth Klarman beats the market and he buys low and sells High. DCA is mediocre.
Seth klarman is a value investor this doesn’t apply to him. He does not make decisions based on looking at a price chart or doing technical analysis. He values companies. This is for everyone else.
Now add a Person that is constantly day trading for 40 years, with a annual income of 300.000$ after taxes.
Now find someone that actually achieves that… chase that dream and before you know it you’ll be 60 with $0 to your name.
No doubt consistence investing in quality equities is proofed to be for highest results. But if you swing trade this is not applicable at all. Investing vs Trading.
Yes, trading is a different game than investing and I have my opinions on it 🤪 Thanks for commenting, I appreciate you!
The greatest investors buy low sell high. DCA is mediocre
The greatest investors value companies and buy them when the stock market delivers a price below what it’s worth.
For everyone else, buying index funds on a regular schedule is better than trying to time the market by looking at a price chart and guessing the highs and lows and bouncing in and out. That’s just gambling.