Timing the market

MK62

Audaxer said:

MK62 said:

Prism said:

Market timing isn't always about holding cash and trying to predict some form of up turn. It can be paying attention to valuations and growth estimates and then reacting appropriately. 

Yes.....it can take various forms tbh......and to various degrees.
Most of us buy with the expectation, over time, of a rise in value of the assets purchased.....is that market timing? 

No, that's not market timing. If we were not buying with the expectation, over time, of a rise in value, why would we be investing?

I don't think so either really, but then how do you define it?.....you do have to pick a time to invest, one way or another....

Thrugelmir

MK62 said:

Audaxer said:

MK62 said:

Prism said:

Market timing isn't always about holding cash and trying to predict some form of up turn. It can be paying attention to valuations and growth estimates and then reacting appropriately. 

Yes.....it can take various forms tbh......and to various degrees.
Most of us buy with the expectation, over time, of a rise in value of the assets purchased.....is that market timing? 

No, that's not market timing. If we were not buying with the expectation, over time, of a rise in value, why would we be investing?

I don't think so either really, but then how do you define it?.....you do have to pick a time to invest, one way or another....

Also the market(s) to invest in. There's often a generalisation more recently of there being one only market. 

MK62

Thrugelmir said:

MK62 said:

Audaxer said:

MK62 said:

Prism said:

Market timing isn't always about holding cash and trying to predict some form of up turn. It can be paying attention to valuations and growth estimates and then reacting appropriately. 

Yes.....it can take various forms tbh......and to various degrees.
Most of us buy with the expectation, over time, of a rise in value of the assets purchased.....is that market timing? 

No, that's not market timing. If we were not buying with the expectation, over time, of a rise in value, why would we be investing?

I don't think so either really, but then how do you define it?.....you do have to pick a time to invest, one way or another....

Also the market(s) to invest in. There's often a generalisation more recently of there being one only market. 

True, but we were considering the timing of any investment rather than the actual asset to invest in.....in my world the latter comes first, then the former.
Of course, we could be talking about a global multi-asset fund.....which then makes timing rather more.....interesting....😉

Prism

I suppose that the kind of stuff a few of us did during last years short crash counts as market timing. I sold one of my bond funds at what I believed was a high, bought a private equity fund at what I thought was a low and then over the later part of the year started to sell a few things that had recovered well to replenish the bond fund. It was a risk that worked... this time.

Prism

BritishInvestor said:

"Ah....the old SPIVA report again..... "

What do you see as the flaws in their logic?

"Just look at Trustnet or Morningstar over 5 or 10 years.......see where the index funds are in the performance tables...."

Based on the SPIVA data, somewhere around top quartile when measured over long enough periods?

I like the SPIVA reports however they don't tell you all that much.

It tells you what your chances are of picking a decent fund if you pick randomly but not much about if you select a specific fund. It also cannot tell us how individual investors do. For example in a scenario where nine funds underperform and only one outperforms, mathematically its possible that all investors outperform overall if maybe they hold 2 or 3 funds each.

It tells us which regions have more better performing funds but not by how much do those funds outperform or underperform.

It tells us that as a whole UK investors using active funds covering the UK and European regions outperform their benchmarks. Not how many individuals, nor their chances of selecting funds to achieve this, but as a total sum of money.

BritishInvestor

Prism said:

BritishInvestor said:

"Ah....the old SPIVA report again..... "

What do you see as the flaws in their logic?

"Just look at Trustnet or Morningstar over 5 or 10 years.......see where the index funds are in the performance tables...."

Based on the SPIVA data, somewhere around top quartile when measured over long enough periods?

I like the SPIVA reports however they don't tell you all that much.

It tells you what your chances are of picking a decent fund if you pick randomly but not much about if you select a specific fund. It also cannot tell us how individual investors do. For example in a scenario where nine funds underperform and only one outperforms, mathematically its possible that all investors outperform overall if maybe they hold 2 or 3 funds each.

It tells us which regions have more better performing funds but not by how much do those funds outperform or underperform.

It tells us that as a whole UK investors using active funds covering the UK and European regions outperform their benchmarks. Not how many individuals, nor their chances of selecting funds to achieve this, but as a total sum of money.

"It also cannot tell us how individual investors do."

Typically poorly, buying high and selling low.

Prism

BritishInvestor said:

Prism said:

BritishInvestor said:

"Ah....the old SPIVA report again..... "

What do you see as the flaws in their logic?

"Just look at Trustnet or Morningstar over 5 or 10 years.......see where the index funds are in the performance tables...."

Based on the SPIVA data, somewhere around top quartile when measured over long enough periods?

I like the SPIVA reports however they don't tell you all that much.

It tells you what your chances are of picking a decent fund if you pick randomly but not much about if you select a specific fund. It also cannot tell us how individual investors do. For example in a scenario where nine funds underperform and only one outperforms, mathematically its possible that all investors outperform overall if maybe they hold 2 or 3 funds each.

It tells us which regions have more better performing funds but not by how much do those funds outperform or underperform.

It tells us that as a whole UK investors using active funds covering the UK and European regions outperform their benchmarks. Not how many individuals, nor their chances of selecting funds to achieve this, but as a total sum of money.

"It also cannot tell us how individual investors do."

Typically poorly, buying high and selling low.

I reckon the average investor simply sticks their monthly or yearly money into their pension or ISA and mostly forgets about it. Active or passive.

MK62

Prism said:

BritishInvestor said:

Prism said:

BritishInvestor said:

"Ah....the old SPIVA report again..... "

What do you see as the flaws in their logic?

"Just look at Trustnet or Morningstar over 5 or 10 years.......see where the index funds are in the performance tables...."

Based on the SPIVA data, somewhere around top quartile when measured over long enough periods?

I like the SPIVA reports however they don't tell you all that much.

It tells you what your chances are of picking a decent fund if you pick randomly but not much about if you select a specific fund. It also cannot tell us how individual investors do. For example in a scenario where nine funds underperform and only one outperforms, mathematically its possible that all investors outperform overall if maybe they hold 2 or 3 funds each.

It tells us which regions have more better performing funds but not by how much do those funds outperform or underperform.

It tells us that as a whole UK investors using active funds covering the UK and European regions outperform their benchmarks. Not how many individuals, nor their chances of selecting funds to achieve this, but as a total sum of money.

"It also cannot tell us how individual investors do."

Typically poorly, buying high and selling low.

I reckon the average investor simply sticks their monthly or yearly money into their pension or ISA and mostly forgets about it. Active or passive.

Quite probably tbh.....though I suspect many on here are a little more involved than that.....

Audaxer

Prism said:

BritishInvestor said:

Prism said:

BritishInvestor said:

"Ah....the old SPIVA report again..... "

What do you see as the flaws in their logic?

"Just look at Trustnet or Morningstar over 5 or 10 years.......see where the index funds are in the performance tables...."

Based on the SPIVA data, somewhere around top quartile when measured over long enough periods?

I like the SPIVA reports however they don't tell you all that much.

It tells you what your chances are of picking a decent fund if you pick randomly but not much about if you select a specific fund. It also cannot tell us how individual investors do. For example in a scenario where nine funds underperform and only one outperforms, mathematically its possible that all investors outperform overall if maybe they hold 2 or 3 funds each.

It tells us which regions have more better performing funds but not by how much do those funds outperform or underperform.

It tells us that as a whole UK investors using active funds covering the UK and European regions outperform their benchmarks. Not how many individuals, nor their chances of selecting funds to achieve this, but as a total sum of money.

"It also cannot tell us how individual investors do."

Typically poorly, buying high and selling low.

I reckon the average investor simply sticks their monthly or yearly money into their pension or ISA and mostly forgets about it. Active or passive.

I agree most working people simply add monthly contributions into a pension, and probably have little idea what it is invested in. Other than those of us on here, I would think it is a relatively small percentage of the population that also invest in S&S ISAs. 

sevenhills

Except that the FTSE all share is slightly lower now than it was over a year ago.

I timed the market by selling Ricardo PLC at almost its peak in November and the same with Metro Bank PLC, I do of course get it wrong sometimes.