How to handle the moment you put money into a tracker fund given the markets volatility?

Thrugelmir

jim_arm_chair said:

Sorry, based on the replies I don't think I've been clear. I'm investing for the long term and not looking to 'play the market'. My question is just about when I first put the money in. Once it's in I plan to leave it for 5+ years. Thanks

Don't buy investments that aren't traded in real time until markets stabilise and settle down. Panic appears to be driving markets at the moment. The shakedown may last a while yet.  

Linton

Thrugelmir said:

jim_arm_chair said:

Sorry, based on the replies I don't think I've been clear. I'm investing for the long term and not looking to 'play the market'. My question is just about when I first put the money in. Once it's in I plan to leave it for 5+ years. Thanks

Don't buy investments that aren't traded in real time until markets stabilise and settle down. Panic appears to be driving markets at the moment. The shakedown may last a while yet.  

I do not see the logic in this.  WIth the current high volatility whether you buy real time or not you do not know what tomorrow's price is, it could be significantly higher or lower.  Today's price which you know is just as arbitrary as tomorrow's price which you dont. So knowing today's price gives you no good basis on which to decide whether to buy or not.

Better in my view is to think long term.  You know (or very strongly believe) that the price in say 10 years time will be higher than the current price.  If you dont strongly believe this, dont invest at all.  So if you want to invest you may as well put the order in now, whether you buy at today's price or tomorrow's is irrelevent. There is no advantage in waiting until prices are more stable - at that point they will probably be higher.

Thrugelmir

Linton said:

Thrugelmir said:

jim_arm_chair said:

Sorry, based on the replies I don't think I've been clear. I'm investing for the long term and not looking to 'play the market'. My question is just about when I first put the money in. Once it's in I plan to leave it for 5+ years. Thanks

Don't buy investments that aren't traded in real time until markets stabilise and settle down. Panic appears to be driving markets at the moment. The shakedown may last a while yet.  

I do not see the logic in this.  

I can only assume that you only trade in collective investments not individual shares. 

AnotherJoe

jim_arm_chair said:

Ive opened FTSE 100 Index Unit Trust with Vanguard. As the FTSE is so volatile at the moment, the day and even hour that my cash is converted to shares will make a big difference to what I actually get. Is there a way to manage this? 

UPDATE
Sorry, based on the replies I don't think I've been clear. I'm investing for the long term and not looking to 'play the market'. My question is just about when I first put the money in. Once it's in I plan to leave it for 5+ years. 

Why?

Simply, dont do that. terrible idea.

 

Alexland

I agree with the others if you have a Vanguard account there is no reason to limit your investment to UK large cap (which is under 5% of the global market and has historically performed poorly) so its worth considering a global fund such as Vanguard FTSE Global All Cap or for a lower volatility profile Vanguard LifeStrategy 80 or 60 as appropriate.
In terms of timing an initial lump sum purchase it can drive you mad and you will probably never get it perfect so eventually you just have to accept that and go ahead.

Eco_Miser

Leaving aside your choice of fund to invest in, decide whether you think it will be higher in 5 - 10 years. If not don't buy at all; if so, buy  and forget - don't check your investment until the current bear market is over.

Thrugelmir

Eco_Miser said:

don't check your investment until the current bear market is over.

Interestingly investors check their investments when markets are more buoyant. Rather than monitoring more when the wheels fall off. 

schiff

Thrugelmir said:

Eco_Miser said:

don't check your investment until the current bear market is over.

Interestingly investors check their investments when markets are more buoyant. Rather than monitoring more when the wheels fall off. 

That is so true. I used to check most days just to wallow in the sea of blue figures but when it started to get really bad I stopped. I'm sitting it out.

saoliver

AnotherJoe said:

jim_arm_chair said:

Ive opened FTSE 100 Index Unit Trust with Vanguard. As the FTSE is so volatile at the moment, the day and even hour that my cash is converted to shares will make a big difference to what I actually get. Is there a way to manage this? 

UPDATE
Sorry, based on the replies I don't think I've been clear. I'm investing for the long term and not looking to 'play the market'. My question is just about when I first put the money in. Once it's in I plan to leave it for 5+ years. 

Why?

Simply, dont do that. terrible idea.

 

Hi, can you elaborate please on why this is a terrible thing to do?  I think a lot of people with a 5 year + plan are thinking of taking advantage of cheaper UK equities at the moment. Can you explain please?

Thrugelmir

saoliver said:

AnotherJoe said:

jim_arm_chair said:

Ive opened FTSE 100 Index Unit Trust with Vanguard. As the FTSE is so volatile at the moment, the day and even hour that my cash is converted to shares will make a big difference to what I actually get. Is there a way to manage this? 

UPDATE
Sorry, based on the replies I don't think I've been clear. I'm investing for the long term and not looking to 'play the market'. My question is just about when I first put the money in. Once it's in I plan to leave it for 5+ years. 

Why?

Simply, dont do that. terrible idea.

 

Hi, can you elaborate please on why this is a terrible thing to do?  I think a lot of people with a 5 year + plan are thinking of taking advantage of cheaper UK equities at the moment. Can you explain please?

Cheap is a relative term. As an investor your objective should be to identify value.