monitoring a sipp

dannybbb

as im still fairly new to having a sipp i wondered do people invest regardless and just leave it or do you look at the market and say theres potentially a large fall after the US election and sell to protect any (small) gains against a big loss to ride out that potential volatility or so you just invest regardless and forget about it?

dannybbb

ps my funds are hsbc global balanced and dynamic

Voyager2002

Anything that you know about (like the US election) has already been 'priced in'. Frequent dealing is a guaranteed way to lose money.

However, many people enjoy speculating, trying to work out what is happening and what will happen next in terms of market prices. This can be a fascinating hobby, but is unlikely to make you more money than simply investing and leaving your pot. There are plenty of people who follow both approaches, so it is entirely up to you.

dannybbb

Thanks - makes sense i just wondered about big events . i also have 16k waiting to invest. ill at least wait until after the election to invest that

dunstonh

Short term events are just noise.   

or do you look at the market and say theres potentially a large fall after the US election and sell to protect any (small) gains against a big loss to ride out that potential volatility or so you just invest regardless and forget about it?

A recipe on how to lose money.     

If you are paying in monthly, then you want volatility in the short term.  You want losses. 

dannybbb

thanks for the reasurrance

Exodi

dannybbb said:

Thanks - makes sense i just wondered about big events . i also have 16k waiting to invest. ill at least wait until after the election to invest that

I think Voyager2002's comment about market efficiency and the fact that information in the public domain (e.g. a massively publicised general election in the largest economy in the world) will already be priced into the market has gone over your head.

What the actual investment decision would be, is whether your market expectations are greater or lower than the expectations of other market participants.

As an example, imagine Samsung invents a new breakthrough processing chip that is 100x faster than anything else on the market, the stock price increases as you read about it in the news. You think that this new chip could soon be implemented in their phones and devices which would undoubtedly dramatically increase sales and cause their stock price to increase. In reality, the news about this is public domain and many people have had the same thought, hence the stock price immediately increasing by the time you heard about it. If you were to invest now, it's no longer on the basis that turnover will increase as a product of this new technology (as that is now already priced in), it's that turnover will increase more than other people expect it to.

There is a famous adage 'Buy The Rumour, Sell The News' and it highlights the fact that by the time Joe Public hears of something it is priced in. It is counter-intuitive but you'll find the worst time to invest in a company is when news is announced that suggests the stock price is about to sky rocket.

As to your specific example: https://www.cnbc.com/2024/11/04/what-the-stock-market-typically-does-after-the-us-election-according-to-history.html

"In fact, the three indexes have all averaged declines in the session and week following those voting days. Stocks have tended to erase most or all of those losses within a month, CNBC data shows.

This means investors should not be anticipating an immediate pop on Wednesday or the next few days after."

Sg28

Set up a direct debit and forget about it. 

If the market falls great you're buying cheaper if it rises great you're profiting. 

Maybe do a review once a year to check your fund performance and platform fees. 

Tassie_Devil

dannybbb said:

as im still fairly new to having a sipp i wondered do people invest regardless and just leave it or do you look at the market and say theres potentially a large fall after the US election and sell to protect any (small) gains against a big loss to ride out that potential volatility or so you just invest regardless and forget about it?

Successful investors learn not to tinker in this manner. 

Invest and forget trying to predict the market. 

https://cre8wm.co.uk/cms/wp-content/uploads/2019/05/May-June-19-Best-investors-are-dead.pdf

Hoenir

dannybbb said:

ps my funds are hsbc global balanced and dynamic

You hold diversified investments. The fund managers will be determining an appropriate allocation between countries / asset classes. Little point trying to self manage and layer on top your own outlook. As others have said drip feed the money if you are nervious about markets in general. Though timing markets to perfection is nigh impossible . Better to be fully invested and allow the income generated to be reinvested. 

redpete

When paying into a pension I will have decided what proportion I want to be held in different funds and allocate new money in those proportions. Periodically (maybe once a year) I will rebalance the holdings to get to the proportions I had originally agreed on.

Basing where your funds will go based on today's or yesterday's events means that you are always trying to catch up with the market that will have already priced in the expectations of tomorrow's events. Is your knowledge and understanding of any company or market better than "the market" will have?