Rhys Adams
Rhys Adams
Australia
3mo
Hi Ladies and Gentlemen! Lets talk about π™’π™–π™§π™ π™šπ™© π™©π™žπ™’π™žπ™£π™œ! Some people do it, some people love it, plenty of people hate it! I feel like the last months S&P returns are a great illustration why I am not a fan. Human nature kicks in, you start to see red in the portfolio, most people begin selling on the way down (The big red circles below). What you do here is realise the recent loss, then wait for the rebound. However the rebound often happens very fast (The green circles). You will notice these drops and rebounds happen over the period of days. You never know if your at the start of a year long market crash, so lets say you take a few days to sell, then a few days to buy, all you have done is realised the loss and missed the rebound. We never know what the market will do tomorrow, so it is almost impossible to accurately predict the full market crash. If you see the top line, the S&P returns over the last eight years, you will see plenty of dips or drops, plenty of time to sell, thinking you can time the market. But you'll also notice plenty of steep rises, that would happen over periods of days or week, very easy to miss! But over the long term, the market moves up. It always has, always will. Companies know how to make money, so if you own them long enough, so will you. My personal strategy is to keep buying long term, if the market drops, buy more. I might have negative months or years, but overall the market and the companies will make money, which means so will I. I also find it takes a lot of the stress away, rather than worrying about what the market will do tomorrow, just embrace the fact we cannot know, so keep buying and just know long term we will make money. As always, thanks for reading, if you have any questions, ask away! Rhys Adams
Not investment advice. The author may have financial interests in the mentioned instruments.
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