Time in the market

kidmugsy

Linton wrote: »

It may be better but that doesnt provide any answer to the timing question. If you arent in a period of very low PE what do you do? Are you better off leaving your money in the bank? From the graph almost all the data points show an average over 10 years greater than current bank interest.

One piece of advice I read (about twenty years ago?) was that if equities looked poor value, invest in National Savings' Index-Linked Savings Certificates. Alas ........

Glen_Clark

Shaolin_Monkey wrote: »

I know of an IFA who was keeping a client I know (and I assume a whole bunch of clients) in very cautious funds for a period of time (late '09 to mid 2011) on the basis that the markets looked overvalued and were due a correction. The clients missed most equity growth during that period. In mid 2011 he appeared to have a change of heart and, deciding there would be no correction, switched the client I know's portfolio (and probably others) into 100% high risk specialist equity funds. Of course the market subsequently corrected within weeks, and the client lost a packet (20%+ in a short space of time). Unhappy with this, the client decided the IFA had invested above his risk profile and sold out soon after the 2011 correction had "bottomed out" and ended his relationship with the IFA, deciding to go DIY to try to recover his losses. True story...

I guess what I'm trying to say is beware of any IFA who claims to have inside knowledge of what the markets are going to do next or claims to be able to successfully trade in and out of funds according to market conditions. It's likely to be b******s

With all the wisdom of hindsight he was wrong.
But it was a perfectly logical view to hold at the time.
I think the only thing he failed to forsee was the astronomical, unprecedented money printing that turned everything upside down.
Everything he had been taught was wrong because of the money printing.
Without the money printing, he would have been right.

Who could forsee that.
Well the Bank of England shifted their staff pension fund into index linked bonds before the printing started. I wonder how they knew

Ark_Welder

kidmugsy wrote: »

One piece of advice I read (about twenty years ago?) was that if equities looked poor value, invest in National Savings' Index-Linked Savings Certificates. Alas ........

Ditto the alas.

Glen_Clark wrote: »

Well the Bank of England shifted their staff pension fund into index linked bonds before the printing started. I wonder how they knew

No conspiracy, just basic common sense: match assets to liabilities, and the BoE pensions are inflation linked - and have been for a good number of years. Boring, but there you go (most things are, in truth, hence the need for conspiracy theories to stir things up a bit for the sake of entertainment).