Grabbing the bottom of the market

[Anonymous]

Anonymous wrote:You all timing the market are going to have a lot of trouble. Expect a 15% quick upswing after we hit bottom, get some good news and money starts flowing back in.

No one has to predict or wait for THE bottom. Investing NEAR the bottom is still better than taking the elevator all the way down. As for me, I put in a quarter of my cash on Friday.

[Anonymous]

Anonymous wrote:

Anonymous wrote:You all timing the market are going to have a lot of trouble. Expect a 15% quick upswing after we hit bottom, get some good news and money starts flowing back in.

No one has to predict or wait for THE bottom. Investing NEAR the bottom is still better than taking the elevator all the way down. As for me, I put in a quarter of my cash on Friday.

Exactly. In fact, by the very definition of bottom, it is never wise to wait until you think it has already occurred, as you’ll already have missed it. It is much safer to start dollar cost averaging back in to stocks when you’re within roughly 10% of the estimated bottom. I’m 45% back in already: 33% in small-cap growth, 8% in mid-cap growth, and 4% in large-cap blend. The remaining 55% awaits further market drops and will be heavily invested in mid-cap and large-cap growth stocks. Again, not all at once, unless you can predict the future. DCA new purchases each time your chosen stocks/ETFs drop 2-4%. Small-caps have already dropped a ton for fear they lack strength to persist. Mid-caps bottom next. Large-caps hold out til the end, as people figure these investments can weather minor economic challenges.

[Anonymous]

I’d buy now. I thankfully kept buying through three market declines. It’s been a good thing long-term and I’m three years from retirement but thinking ahead to 30 years more alive.

[Anonymous]

Anonymous wrote:I’d buy now. I thankfully kept buying through three market declines. It’s been a good thing long-term and I’m three years from retirement but thinking ahead to 30 years more alive.

Damn

[Anonymous]

Would Putin using tactical or other nukes count as a black swan event? The tide would go out quite dramatically.

[Anonymous]

Anonymous wrote:Trying to time the bottom is a fool’s errand. That being said, we can always make an educated estimate.

The average annualized S&P 500 return since 1957 has been 11.88%. The two most significant recent bottoms were in March 2009 (approximately 13.5 years ago at 677) and then again in March 2020 (approximately 2.5 years ago at 2237). The 2009 bottom propagated forward to today would have put the S&P 500 at:

677 * (1.1188^13.5) = 3081

The 2020 bottom propagated forward to today would have put the S&P 500 at:

2237 * (1.1188^2.5) = 2962

These are pretty close, as one might expect from legitimate corrections, with the average being 3021. So, my guess is that a reasonable estimate for the S&P 500 bottom today is around 3021 and, therefore, that we still have room to fall. But, the S&P 500 historically grows at a rate of about 11.88% YoY or 0.93% MoM. With each passing month, our estimate for the S&P 500 bottom needs to increase, perhaps as follows:

10/22: 3021 * 1.0093^0 = 3021
11/22: 3021 * 1.0093^1 = 3049
12/22: 3021 * 1.0093^2 = 3077
01/23: 3021 * 1.0093^3 = 3106
02/23: 3021 * 1.0093^4 = 3135
03/23: 3021 * 1.0093^5 = 3164
04/23: 3021 * 1.0093^6 = 3194
05/23: 3021 * 1.0093^7 = 3223
06/23: 3021 * 1.0093^8 = 3253
07/23: 3021 * 1.0093^9 = 3283
08/23: 3021 * 1.0093^10 = 3314
09/23: 3021 * 1.0093^11 = 3345
10/23: 3021 * 1.0093^12 = 3376
11/23: 3021 * 1.0093^13 = 3407
12/23: 3021 * 1.0093^14 = 3439

When the actual S&P 500 intersects the estimated trajectory of the above, I suspect we’ll be at or near the bottom. The sooner the correction is over, the better.

In theory this is at least educated but has no relevance to the market now or in the future. No analysis knows when the market will bottom..that is why investing is a long game

[Anonymous]

Buy on gap downs. Market opens down 2%. Put 20% of cash in. No more. Bears are waiting for capitulation. There are signs, like tesla hit $205. This next 2 weeks tech earnings could be the capitulation moment. Buy more then if it happens. Examples would AAPL at $130, TSLA 190.

[Anonymous]

Anonymous wrote:

Anonymous wrote:Trying to time the bottom is a fool’s errand. That being said, we can always make an educated estimate.

The average annualized S&P 500 return since 1957 has been 11.88%. The two most significant recent bottoms were in March 2009 (approximately 13.5 years ago at 677) and then again in March 2020 (approximately 2.5 years ago at 2237). The 2009 bottom propagated forward to today would have put the S&P 500 at:

677 * (1.1188^13.5) = 3081

The 2020 bottom propagated forward to today would have put the S&P 500 at:

2237 * (1.1188^2.5) = 2962

These are pretty close, as one might expect from legitimate corrections, with the average being 3021. So, my guess is that a reasonable estimate for the S&P 500 bottom today is around 3021 and, therefore, that we still have room to fall. But, the S&P 500 historically grows at a rate of about 11.88% YoY or 0.93% MoM. With each passing month, our estimate for the S&P 500 bottom needs to increase, perhaps as follows:

10/22: 3021 * 1.0093^0 = 3021
11/22: 3021 * 1.0093^1 = 3049
12/22: 3021 * 1.0093^2 = 3077
01/23: 3021 * 1.0093^3 = 3106
02/23: 3021 * 1.0093^4 = 3135
03/23: 3021 * 1.0093^5 = 3164
04/23: 3021 * 1.0093^6 = 3194
05/23: 3021 * 1.0093^7 = 3223
06/23: 3021 * 1.0093^8 = 3253
07/23: 3021 * 1.0093^9 = 3283
08/23: 3021 * 1.0093^10 = 3314
09/23: 3021 * 1.0093^11 = 3345
10/23: 3021 * 1.0093^12 = 3376
11/23: 3021 * 1.0093^13 = 3407
12/23: 3021 * 1.0093^14 = 3439

When the actual S&P 500 intersects the estimated trajectory of the above, I suspect we’ll be at or near the bottom. The sooner the correction is over, the better.

In theory this is at least educated but has no relevance to the market now or in the future. No analysis knows when the market will bottom..that is why investing is a long game

Incorrect. This analysis is highly correlated with current market conditions. To suggest that it isn’t is to ignore the impact of future earnings estimates on society’s perceptions of appropriately valued stock prices. You can certainly dollar cost average your way to long-term gains, but it likely won’t be until 2027 that the S&P 500 regains it’s previous peak value of 4819. Meanwhile, those that liquidated into cash when both stocks and bonds were obviously overvalued and then followed the above analytical recipe will have gained 60% more wealth than their DCA counterparts.

[Anonymous]

On the day the market hits bottom, they will ring the bell 1 second longer at the NY stock exchange. Be on the lookout for that.

[Anonymous]

When the price of North Sea crude is in capitulation with the Checkerburger.

[Anonymous]

Already missed it OP. Its already a rocket up.

[Anonymous]

Anonymous wrote:On the day the market hits bottom, they will ring the bell 1 second longer at the NY stock exchange. Be on the lookout for that.

Didn’t that happen Friday.

[Anonymous]

Anonymous wrote:

Anonymous wrote:Trying to time the bottom is a fool’s errand. That being said, we can always make an educated estimate.

The average annualized S&P 500 return since 1957 has been 11.88%. The two most significant recent bottoms were in March 2009 (approximately 13.5 years ago at 677) and then again in March 2020 (approximately 2.5 years ago at 2237). The 2009 bottom propagated forward to today would have put the S&P 500 at:

677 * (1.1188^13.5) = 3081

The 2020 bottom propagated forward to today would have put the S&P 500 at:

2237 * (1.1188^2.5) = 2962

These are pretty close, as one might expect from legitimate corrections, with the average being 3021. So, my guess is that a reasonable estimate for the S&P 500 bottom today is around 3021 and, therefore, that we still have room to fall. But, the S&P 500 historically grows at a rate of about 11.88% YoY or 0.93% MoM. With each passing month, our estimate for the S&P 500 bottom needs to increase, perhaps as follows:

10/22: 3021 * 1.0093^0 = 3021
11/22: 3021 * 1.0093^1 = 3049
12/22: 3021 * 1.0093^2 = 3077
01/23: 3021 * 1.0093^3 = 3106
02/23: 3021 * 1.0093^4 = 3135
03/23: 3021 * 1.0093^5 = 3164
04/23: 3021 * 1.0093^6 = 3194
05/23: 3021 * 1.0093^7 = 3223
06/23: 3021 * 1.0093^8 = 3253
07/23: 3021 * 1.0093^9 = 3283
08/23: 3021 * 1.0093^10 = 3314
09/23: 3021 * 1.0093^11 = 3345
10/23: 3021 * 1.0093^12 = 3376
11/23: 3021 * 1.0093^13 = 3407
12/23: 3021 * 1.0093^14 = 3439

When the actual S&P 500 intersects the estimated trajectory of the above, I suspect we’ll be at or near the bottom. The sooner the correction is over, the better.

In theory this is at least educated but has no relevance to the market now or in the future. No analysis knows when the market will bottom..that is why investing is a long game

+1
These rudimentary projections aren't really that useful. While you are waiting for the market to bottom, the cash you have sitting on the sidelines is missing out on opportunity cost. Several studies show this is not an optimal strategy. And markets can take 10+ yrs to rebound, so if you are changing your asset allocation in any meaningful way in an effort to buy at or near the bottom, you are stuck with that choice for a long time. A lot of people going overboard with analyzing data (typically highly educated) think they have an advantage, but they rarely win. Cliff Asness is a brilliant guy and great example of this. His AQR funds are abysmal.

[Anonymous]

I'm starting to believe markets have little to do with economic happenings.

[Anonymous]

Anonymous wrote:

Anonymous wrote:On the day the market hits bottom, they will ring the bell 1 second longer at the NY stock exchange. Be on the lookout for that.

Didn’t that happen Friday.

Are you sure? Is your clock tuned?