Thread: Hello and question

You can't learn it all at once but often time in the market can be more rewarding than timing the market. I built myself a Birchtree 300 index and am doing nicely with it to the tune of almost a $2M gain from the March '09 lows. Some of us do let our friends buy and hold.

Market timing is a losing game, trying to call tops and bottoms is pretty much impossible...

However watching a market slide 5-10% or more and doing nothing, is just as bad if not worse... pull money out when the market changes direction. and I mean it has confirmed a direction change. You can also invest fresh money as it falls sure, nothing wrong with that. when it hits bottom and starts to turn back up thens the time to be back in.

If your not sure on how to determine market trends and reversals many folks will follow someone else's system.

Originally Posted by ozzyman

Market timing is a losing game, trying to call tops and bottoms is pretty much impossible...

However watching a market slide 5-10% or more and doing nothing, is just as bad if not worse... pull money out when the market changes direction. and I mean it has confirmed a direction change. You can also invest fresh money as it falls sure, nothing wrong with that. when it hits bottom and starts to turn back up thens the time to be back in.

If your not sure on how to determine market trends and reversals many folks will follow someone else's system.

Of course- your mileage may vary.

Yes, there are folks here that consistently beat the market. And systems that do it too.

Don't tell me it's impossible to call tops and bottoms. Instead, challenge yourself to see how well you can do.

It's up to you.

Welcome aboard nfdennis. What year was this book written?

All I can say is, the S&P 500 has returned an average of 1.41% for the last ten years. Even before my trading system was a finished product, I have beaten the C and S funds 2 of the last 3 years. Market timing is possible. The only ones who don't think that are the ones who can't do it, or the ones who make money on the people who don't do it. Or writers.................

Of course people will chime in saying I just picked a bad 10 year period or whatever, but I'm not concerned about what happened 50 years ago. Times have changed with the internet and with program trading.

Be quick, be nimble is my advice.....................

Originally Posted by nfdennis

Hello all,

New poster, been a lurker for a while. Thank you for all of the input you provide here, and in your recommendations for reading material, etc.

I have some question regarding one of the books recommended, especially in light of the way most folks here manage their tsp accounts. Bogle, in The Little Book of Common Sense Investing, makes the argument that it is a loser's game to try to beat the market. He states that a goal should be to "own companies," not to try to beat the market, and the way to get there is best achieved through index funds, which is, in essence, what tsp is, I think. In owning companies, he argues that you are playing a winners game, as you will achieve the level of success that each of the businesses comprised in the index achieve. (For most of his book, he recommends owning every company in the US, so the Dow Completion Index is where it's at, which happens to be our S fund, if I'm not mistaken). His argument is pretty compelling. So his advice is a buy, accumulate and hold strategy.

So, if you recommend this book, and you move in and out of funds to try to beat the market, why do you recommend this book? And, has anyone been consistently successful at beating the market, through it's history? And if you disagree with his premise that trying to beat the markets (market timing) is a losers game, why?

Thanks for your patience with someone who is trying to get smarter about money and markets.

First off, the Wilshire 4500 (S-Fund) is the Wilshire 5000 minus the top 500. So in essence if you owned both the C & S funds you would own the entire American markets. As for the book, it's designed for simplistic investing for people who don't want or care to watch their money every waking minute of their lives. IMHO this book is outdated, not reflecting the extreme 2008 market crash that sucked buy & holders dry. The reality is free-minded folks join this forum because there is an inner will within people to do better than the status quo.

Can you time the major tops & bottoms?

I have a better question, can you consistently beat the markets? Yes you can!

nfdennis,

Welcome aboard. Looks like you touched a nerve. Sit back, relax and soak it all in. Some pretty savvy folks around these parts.

Originally Posted by nfdennis

And if you disagree with his premise that trying to beat the markets (market timing) is a losers game, why?

Welcome nfdennis! Thanks for joining us!

Difficult, but not impossible...

Weclome aboard!

Don't worry about beating the market or picking a top or bottom; I think both mindsets aren't overly helpful. Keep track of the economy, use this site as a resource and do the best you can. There are plenty of investment theories floating around, see which ones have been successful and see which ones make sense to YOU.

Best of luck!

BigJohn