My portfolio. Does this look ok?

Yes you are right.. ,

I invested 8% the other day when the market was around 6400 and that was at around the start of March and I knew it would just keep going down.

Although I put a mental stop on it for the moment I can always just DCA again start of April.. That was the plan, to do it monthly. I probably will anyway.. But smaller amount.


-Frank

 

Thanks for updating us @Frank Manno i think what others are trying to say is that if you think the market will be in a position to start buying again in April and given the current level of volitility why not DCA now on a more frequent basis for the short term and take advantage of the current pricing levels.

 

Nothing wrong with just sitting on the side-lines Frank,as when everyone hits the sell button as panic sets in April may be a very different number..plus the ASX futures don't look good for today as we are going into a rapid fall again ..
Highlights - Bank of England governor speaks at press conference

 

What does your advisor say

btw thanks for posting back

i am not buying this DCA stuff, in particular if you are relatively new to share investing and if you are close to retiring. Just makes no sense

when bull turns to bear it wont be pretty regardless. No one can pick the bottom but when there is no clear way to see the bottom yet why erode capital?

question is it possible for shares to hit gfc pricing???

Dont shoot the messenger just my opinion

 

Says 'sit tight no rush'

Yes I agree. I'm carefully watching. Today I would love to just put 100% of funds in. Market is almost where late 2018 was at 5400 levels..

My feeling is that once the market does start to climb that it won't climb the way it did in 2019 and that we will have a good enough view as to it starting to rise again.


-Frank

 

problem is until we get a vaccine who knows, negativity is contagious, media etc loving it

as long as there are continued reported deaths it will continue to be in free fall?? Fear

 

You may be right but nobody knows. The flip side is heaps of stimulus packages globally and then a vaccine is announced unexpectedly and whoosh the market turns...off we go again and you have missed the boat...likelihood is neither scenario plays out in full and the market has a period of volitility before slow recovering. If you have the time I believe that’s were the value of DCA comes in to play.

 

while deaths will be announced on a weekly basis dont touch shares its just too risky

 

I was going to make my first DCA purchase of VAS and VGS today if the bank hadn’t stuffed me around with the transfer to my broker account...each to their own.

 

Are you willing to make another $1,000,000 bet Frank ? It may well jump 30% as it has after other virus outbreaks. Think of buying returns for eternity , some companies had outstanding reports APT, EML for example, yet instead of price following potential returns, they even became better buying. Do you really think many companies wont be giving the higher returns in 5 years than they gave last year wether they are 40% cheaper now or 50% , wont make much difference compared to all the future returns.. I bought Teladoc on this mornings weakness, many companies are down for no reason, that should benefit greatly from the current situation. and just bought Propel Funerals hope it doesn't do too good though. What if ? one of the many anti-dotes that have been developed is approved, and fast tracked and the long extensive clinical trials to prove safety and efficacy are waived, or it all just blows over like it has in China, China got a quick rebound.

 

But what about this scenario.

We don't know where the bottom is right? And the point of DCA or investing right now in this market condition is to average out the price right?

Well, if someone were to put money in right now and the market drops 10% in the next week then they are 10% down, for now anyway.

But what if they waited until there was some price stability within an up trend and waited for the price to go up 10% before investing? Then they would make 10% less than having invested today.

So the point is this.

Do you want to 'lose' 10% on the way down or lose '10%' on the way up? Isn't it the exact same thing?



-Frank

 

Short answer: No.

Buying on the way down means you don't know where the floor is. Buying on the way up, the sentiment is there and momentum to keep going.
Of course nothing is a given but more chance that you will make money when prices are on the up.

The trend is your friend

 

Question on this buying on the way up or on the way down. How do you know when it’s on the way up? How much up do you need to see before you are confident that the down has stopped. What if things settle for a week then we go say 10 up. Would you consider that as the up leg and start buying?

Is there a chance that even then it goes back into reverse and drops the 10 plus some?

 

If prices falls in the last few weeks have take us to the same place now as 9 or 10 years ago. Taking a simplistic view isn’t this a good time to buy? I know there may be more falls but surely in the long term this is a once in a decade opportunity?

 

Of course no guarantees.

When I see 3 or 4 consecutive days in a row of higher highs and higher lows then I know we have started an uptrend..

If we see the market trading sideways for a while and then a few days in a row of up then I'm guessing it's an uptrend.. Thats when I will enter large sums.

If it goes down after that then so be it thats the stock market



-Frank

 

Tell that to people who were jumping in late last year...the trend was up. You buy when you see value...period.

 

In my opinion it is not the same thing. If you buy today you can buy 1,000 shares. If the value goes down by 10%, you still have 1,000 shares. If you wait for the price to increase 10%, you can only buy 900 shares. The person with 1,000 shares will be better off in 12 months time than the person with 900 shares.

 

As mentioned, I have NFI where the bottom is, or when an effective antiviral or vaccine will be announced, but I do know this - C19 will fade at some point, probably within the next 12 months. Anytime between now and then that I start seeing value, I start DCA-ing.

 

A few of these last posts get addressed in the 'World Indices Roundup 2020' thread. Personally I still think there's more falls to come when we start seeing US infection rates go up, hospitals over-stretched and encouraged public lockdowns.

 

A possible theory is that as more get infected, the 'survivors' may realise the panic was worse than the disease itself. I think more than anything is the fear of the unknown ie the pandemic. Does anyone really believe we only have sub 200 cases in Australia? The true number might already be 10 or a 100 times that.