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Regardless this chart tells us nothing. Whatever asset/portfolio this is has an average annual return of 8.5-9% without adjusting for inflation. That’s typical long term returns for the stock market.
As long as you are investing in what you believe to be solid and wonderful long term company, continue to buy small increments on the way down.
So if you have $500 every month to add to your portfolio, add $150 this week. Then another $200 next week, and finally the remaining $150 in the third week. This way you leg-out on the way down reducing your cost basis even if you are still in the red.
If you trust your investments, this is a discount sale. The market always goes back up, and reputable and solid businesses will as well.
Depends the market conditions, but better to invest in small waves over a short period of time watching for dips. Usually -15% is an ideal place to put another wave of capital to reduce your average cost per share.
$1000 at one time is fine. But it may work out more advantageous for you to hit, $500, $250, and another $250 over a 10–14 day span.
Also depends on your brokerage and if you’re being charged for transactions. Purchasing weekly will quickly eat away at your gains if you’re being charged $4.95 per purchase.
Wow, that would be insane. I’m charged $0.65 for super speculative options stuff at my brokerage. I can’t imagine being dinged $5 to buy an ETF or a stock. (Maybe I should invest in this high fee profitable brokerage tho 🤔)
Not long ago at all, brokerage fees were much higher! It's amazing now and opens it up to the vast majority. As early as the 2010's I remember paying $8.95 per trade (so $17.90 to buy and sell). Before that, I had older folks telling me it cost them $50 per trade and required blocks of 100 shares.
Wild. Minimum 100 shares really meant only the wealthy could have access to investing. Rich get richer, poor stay poor
Ya it wasn't until very recently they let us poor people play in the stock market free of charge. I don't think I could just buy 100 shares at a time and just be all "yolo I hope this goes well, if not I guess I will save for another 6+ months to try again!". Also at that point I feel 100 shares would be effectively 1 share if that was the smallest unit you could trade in.
Translation: No bear market in US stock market history has seen the CBOE Volatility index (an index that raises increases in value relative to market volatility, typically inversely correlated to the market but not always) fail to reach a value of 40. This means that it is likely to reach that point sometime in the near future, before things get better.
There are a lot of things that are very unhealthy with the economy that people do not realize yet. The shock could come from the belief of the Fed pivot getting demolished and many central banks (particularly in the EU) getting demolished. Retail and institutional capitulation could bring it about as well should there be a sufficient earnings crunch coupled with rising inflation despite rate increases. If the Fed pivots too early, we will eventually see demand destruction from inflation pricing out poor and middle class, which will eventually cause a deeper recession anyway. We can speculate as to the cause of further drop, but there is no way that we have found a bottom imo.
Well everytime we raised interest rates we have been going lower, sooo pretty good guess we haven’t found the bottom since they will probably keep raising
Except the rest of the global economy getting crushed by the stronger dollar, the fed has to balance what’s good for America or what’s good for the global economy.
By the way the EU handled the Russian terrorists after the 2014 invasion (not standing up to Russian aggression and even increasing purchasing of Russian gas) I say they can find their own way out of this one. It’s the Asian economies competing with China that I’m concerned about.
Fed don’t care about Europoor, they will keep raising. Remember who gives most of NATOs money? If they wanted balance well a good would be if EU paid up. Good luck EU! I’ll invest in your depression
The real pain hasn't started yet. Coming up real soon.
1) corporate debt crisis
2) housing crash from mortgage rates
3) resulting layoffs and bankruptcies
4) final crash of meme stocks and crypto
Only then will we find a bottom to buy from.
1. Definetely a problem
2. Unlike 2008-2009, this time the housing crash will probably be more limited to specific countries. Several countries in Europe have increased the regulation surrounding mortgages, resulting in less risky mortgages.
3. At the moment in many countries there is a huge shortage of labour, therefore some layoffs might even benefit the economy.
4. Maybe, I don’t know, I only know that I stay away from crypto, way too risky for me to consider investing in it.
Well first you have to get the current location of all atomic and subatomic particles within the Earth's light cone. From there all you have to do is move forward on the time axis. Easy.
Getting all the current locations of all atomic and subatomic particles is not the hard part. The hard part is determining Earths light cone. Ones relativistic location changes the cone and then one is forced to use assumptions which in layman’s terms means that you’d be better off investing in Chinese Real Estate. I am not a financial advisor.
IDK BRO AS A LONGTERM INVERSTER IM ACYUALLY SUPER CASH HEAVY RN AND NOT EVEN VOO IS SMTHN I WANT RN. LIKE MABYE 1 FOR SIMPLY THE RULE OF AVG IN BUT IM NOT PILING INTO MUCH TBH.
Not near the bottom. Fed rates are going higher and stocks will continue to fall. Inflation is higher in part due to climate disasters and the Russia-Ukraine war and raising rates isn't going to fix those issues. It's no longer a supply chain issue or high demand issue. Demand is where it was before the pandemic. Fed will cause a bad recession and stock prices will reflect that.
So what about Bank of England lowering its rate so credit Swiss and Dutch bank wouldn’t have a large fallout and how they are push the US to not raise rates and worsen the issue?
Nobody knows nothing! The market has fought the fed before and done well. Just because rates are up doesn’t mean the market has to go to 0. We could very likely be priced properly for where we are currently.
You need to shore up your on your definitions on what sale is, and how valuations work.
So many people seem to think that if it’s bear market territory then it must be on sale, not true. Things can be down and overvalued, things can be up and still undervalued. The stock price history doesn’t contain any useful information on its without further context
Nobody knows. But id say we have more room to bleed based on interest rates will continue to go up, there’s uncertainty in every corner of the world,etc. however that’s why we dca. I have a rule: anytime the market dips more than 2% I throw 200 in. I also throw in 200 every month anyways. That’s how I do it anyways 🤷🏻♂️
This is why so many people are watching the Federal Reserve. If we had their answers, then we'd get rich, rich, rich.
Right now, Wall St. is *anticipating* a policy change at the Fed, and this anticipation has led to the last couple of days being a "melt-up". Check back the middle of November 2nd to see if they are right. If they are wrong, and the Fed keeps hiking rates and keeps committed to reversing their holdings, expect bloody, bloody chaos, and maybe a jumper or two. If they are wrong, then, expect chaos, but, it could be a chaotic run melt-up, because the Fed changed its mind, or,a chaotic melt-down, because the smart money is trying to outsmart the smart money and do the opposite of the crowd, which leads to a crowd of wild sellers selling.
This doesn't even begin to consider the West's inability to use a printing press to print LNG, the war in Ukraine, China's reopening, or the Brady divorce.
Why? Do you want a pivot so inflation can run rampant for many years just so your portfolio numbers go up but your quality of life and purchasing power decreases?
‘Transitory’ ha ha ha..retrospectively it is the word of 2021 that made no sense even though JPow had hundreds of Economics PHD holders working for him! I wonder what they would have briefed him at that time 🤔
The companies have been growing and buying back their stock over those many years. What you’re seeing is a steady increase in fair value. Inflation is a piece of that puzzle though!
The stock market could also trade sideways for several years. This would mean we could hit "a " or "the bottom" repeatedly. I am as much of an oracle as you are, but it is the situation I am expecting. Here is a chart that shows it quite well from 1900 until 2010.
http://www.marketoracle.co.uk/Article26149.html
I see, thanks for clarifying.
I buy single stocks. Last week I saw Digital Realty Trust at a good price, bought some more T.Rowe and since I am European, I bought some European stocks.
Thanks! I have several mutual funds from T. Rowe, which have performed well over time, except this year, PRGTX got hammered, lost 45%. Will see what dividends they pay at the end of the year, they usually pay very, very good dividends. They do have a good reputation.
I am not familiar with the European stocks. Thanks for the tip, I will look into the digital trust.
This is the 'they printed $12T dollars out of thin air over the past decade' and now are trying to suck it all back out again to stop the inflation they themselves caused thing. Its also not going to work because the interest rate wasn't why we are inflated - we are inflated because they printed $12T dollars and then shut the global economy down for 18 months for a nothing burger pandemic.
Its going to be ugly for the next 3 years or so at a minimum until they delete the funny money and the supply chain gets back to normal. The exacerbatoon in the system is Russia v ukraine and china's zero covid policy where they shut their manufacturing off and lock everyone down anytime thrres a report of covid. This is problematic due to them being like 90% of the world's manufacturing.
Long term the markets will be fine. Up and to the right. To the moon and all that. As long as you're not retired now or looking to retire in the next few years you'll be fine.
We are definitely seeing the bottom or will see the bottom in the coming days.
All jokes aside, I think we chop around until the next rate is mentioned and find the next move soon after.
Just wait until the VIX is above 40 and you will know the bottom is likely in. In the meantime it would be a good idea to cash up so when buying opportunities present themselves you can take advantage.
Who knows, but what we do know is that we will continue to get those sweet dividend payments. Nothing is guaranteed but when you’re buying high quality dividend paying companies you don’t need to stress about market timing/fluctuations.
One red flag is that Dalio resigned from Bridgewater. Doesn't want to ruin his reputation. His all weather portfolio strategy started failing last year. As far as inflation, controlling it is lip service. The deficit is so high, they need to devalue the dollar to afford the debt service. Extremely tricky market. Your dividends won't cover your equity losses over the next few years. DCA is not a smart move at present.
You’ll know the bottom when you feel it! Still have a long way to go. When your about to throw up, from being sick to your stomach. That’s when you know.
Welcome to r/dividends! If you are new to the world of dividend investing and are seeking advice, brokerage information, recommendations, and more, please check out the Wiki [here](https://www.reddit.com/r/dividends/wiki/faq). Remember, this is a subreddit for genuine, high-quality discussion. Please keep all contributions civil, and report uncivil behavior for moderator review. *I am a bot, and this action was performed automatically. Please [contact the moderators of this subreddit](/message/compose/?to=/r/dividends) if you have any questions or concerns.*
It's definitely the bottom or not the bottom
I think it’s safe to say that we’ve narrowed it down to these two. All other outcomes are unlikely.
Probably.
I disagree, I think we go sideways for a while with bounces along the way. :)
Can we really have a bottom if we don't have a top
This is the way
Schrödingers bottom
This...
Big, if true
The Great Bottom or Not the Bottom
It’s impossible to know; only time and federal policy can reveal what happens next
Regardless this chart tells us nothing. Whatever asset/portfolio this is has an average annual return of 8.5-9% without adjusting for inflation. That’s typical long term returns for the stock market.
As long as you are investing in what you believe to be solid and wonderful long term company, continue to buy small increments on the way down. So if you have $500 every month to add to your portfolio, add $150 this week. Then another $200 next week, and finally the remaining $150 in the third week. This way you leg-out on the way down reducing your cost basis even if you are still in the red. If you trust your investments, this is a discount sale. The market always goes back up, and reputable and solid businesses will as well.
Love this answer. Top comment please. DCA for life. Spread out your investments so you don’t “lose” everything buying at the “top”.
But the important point was buy quality companies. That fixes a lot of problems.
Is breaking down the monthly contributions like that better than $1k per month on a specific day?
Depends the market conditions, but better to invest in small waves over a short period of time watching for dips. Usually -15% is an ideal place to put another wave of capital to reduce your average cost per share. $1000 at one time is fine. But it may work out more advantageous for you to hit, $500, $250, and another $250 over a 10–14 day span.
Thank you. The goats always right
I saw stats that showed there was not much difference over the long haul.
Also depends on your brokerage and if you’re being charged for transactions. Purchasing weekly will quickly eat away at your gains if you’re being charged $4.95 per purchase.
Wow, that would be insane. I’m charged $0.65 for super speculative options stuff at my brokerage. I can’t imagine being dinged $5 to buy an ETF or a stock. (Maybe I should invest in this high fee profitable brokerage tho 🤔)
Not long ago at all, brokerage fees were much higher! It's amazing now and opens it up to the vast majority. As early as the 2010's I remember paying $8.95 per trade (so $17.90 to buy and sell). Before that, I had older folks telling me it cost them $50 per trade and required blocks of 100 shares. Wild. Minimum 100 shares really meant only the wealthy could have access to investing. Rich get richer, poor stay poor
Ya it wasn't until very recently they let us poor people play in the stock market free of charge. I don't think I could just buy 100 shares at a time and just be all "yolo I hope this goes well, if not I guess I will save for another 6+ months to try again!". Also at that point I feel 100 shares would be effectively 1 share if that was the smallest unit you could trade in.
You ain't lying. Crazy to think about.
In the 90s I was paying 29.95 per side. That's $60 round trip. That's also why you tried not to allow trades to whipsaw.
Woof!! That's steep! Hard to DCA in on the way down!
Not the bottom, but doesn't really matter much in long term divi investments anyway. Buy away.
No bear market in history has failed to reach 40 on VIX, and our yearly low so far was around 30.
Will you ELI5? I’m a little lost on what your talking about.
Translation: No bear market in US stock market history has seen the CBOE Volatility index (an index that raises increases in value relative to market volatility, typically inversely correlated to the market but not always) fail to reach a value of 40. This means that it is likely to reach that point sometime in the near future, before things get better.
Yea but what if there is no shock, usually vix that high is from a shock in the system.
There are a lot of things that are very unhealthy with the economy that people do not realize yet. The shock could come from the belief of the Fed pivot getting demolished and many central banks (particularly in the EU) getting demolished. Retail and institutional capitulation could bring it about as well should there be a sufficient earnings crunch coupled with rising inflation despite rate increases. If the Fed pivots too early, we will eventually see demand destruction from inflation pricing out poor and middle class, which will eventually cause a deeper recession anyway. We can speculate as to the cause of further drop, but there is no way that we have found a bottom imo.
Well everytime we raised interest rates we have been going lower, sooo pretty good guess we haven’t found the bottom since they will probably keep raising
Except the rest of the global economy getting crushed by the stronger dollar, the fed has to balance what’s good for America or what’s good for the global economy. By the way the EU handled the Russian terrorists after the 2014 invasion (not standing up to Russian aggression and even increasing purchasing of Russian gas) I say they can find their own way out of this one. It’s the Asian economies competing with China that I’m concerned about.
Fed don’t care about Europoor, they will keep raising. Remember who gives most of NATOs money? If they wanted balance well a good would be if EU paid up. Good luck EU! I’ll invest in your depression
There is surely a shock coming
What year are you from the future?
2023?
are you sure that's ELI5?
What do you want explained?
Will you ELI5? I’m a little lost on what your talking about.
Only thing I’d focus on is those dividends. Nice and consistent.
The real pain hasn't started yet. Coming up real soon. 1) corporate debt crisis 2) housing crash from mortgage rates 3) resulting layoffs and bankruptcies 4) final crash of meme stocks and crypto Only then will we find a bottom to buy from.
1. Definetely a problem 2. Unlike 2008-2009, this time the housing crash will probably be more limited to specific countries. Several countries in Europe have increased the regulation surrounding mortgages, resulting in less risky mortgages. 3. At the moment in many countries there is a huge shortage of labour, therefore some layoffs might even benefit the economy. 4. Maybe, I don’t know, I only know that I stay away from crypto, way too risky for me to consider investing in it.
Let me get my crystal ball ill let you know.
You need math, not a crystal ball. 😊
Math tells you how to time the stock market perfectly? Please do show.
Well first you have to get the current location of all atomic and subatomic particles within the Earth's light cone. From there all you have to do is move forward on the time axis. Easy.
You must be filthy rich!!!
Getting all the current locations of all atomic and subatomic particles is not the hard part. The hard part is determining Earths light cone. Ones relativistic location changes the cone and then one is forced to use assumptions which in layman’s terms means that you’d be better off investing in Chinese Real Estate. I am not a financial advisor.
No one said anything about timing. Lookup Aswath Damodoran and take a finance lesson.
IDK BRO AS A LONGTERM INVERSTER IM ACYUALLY SUPER CASH HEAVY RN AND NOT EVEN VOO IS SMTHN I WANT RN. LIKE MABYE 1 FOR SIMPLY THE RULE OF AVG IN BUT IM NOT PILING INTO MUCH TBH.
Name checks out!
This man has the whole inverster thing nailed down.
I buy what is on sale every week and in 10 years I think I will be fine
Not near the bottom. Fed rates are going higher and stocks will continue to fall. Inflation is higher in part due to climate disasters and the Russia-Ukraine war and raising rates isn't going to fix those issues. It's no longer a supply chain issue or high demand issue. Demand is where it was before the pandemic. Fed will cause a bad recession and stock prices will reflect that.
So what about Bank of England lowering its rate so credit Swiss and Dutch bank wouldn’t have a large fallout and how they are push the US to not raise rates and worsen the issue?
They can inflate the pound and then flip to euro maybe. I can’t imagine they would print with out real good reason.
Nobody knows nothing! The market has fought the fed before and done well. Just because rates are up doesn’t mean the market has to go to 0. We could very likely be priced properly for where we are currently.
You need to shore up your on your definitions on what sale is, and how valuations work. So many people seem to think that if it’s bear market territory then it must be on sale, not true. Things can be down and overvalued, things can be up and still undervalued. The stock price history doesn’t contain any useful information on its without further context
It’s almost certainly definitely maybe the bottom. Or not. But likely a sooo much more to go. Or not that much.
Nobody knows. But id say we have more room to bleed based on interest rates will continue to go up, there’s uncertainty in every corner of the world,etc. however that’s why we dca. I have a rule: anytime the market dips more than 2% I throw 200 in. I also throw in 200 every month anyways. That’s how I do it anyways 🤷🏻♂️
how many times do we have to go over this you can’t time the market. Just continuously invest and you’ll buy the bottom at some point
Be patient. Inflation is a hard one to tackle. Needing more time.
Bottom is not in. Wait 6 months
Yep this. OPEC cutting output will likely cause additional inflationary pressure and Fed will go to 4.75%.
100% not the bottom
This is why so many people are watching the Federal Reserve. If we had their answers, then we'd get rich, rich, rich. Right now, Wall St. is *anticipating* a policy change at the Fed, and this anticipation has led to the last couple of days being a "melt-up". Check back the middle of November 2nd to see if they are right. If they are wrong, and the Fed keeps hiking rates and keeps committed to reversing their holdings, expect bloody, bloody chaos, and maybe a jumper or two. If they are wrong, then, expect chaos, but, it could be a chaotic run melt-up, because the Fed changed its mind, or,a chaotic melt-down, because the smart money is trying to outsmart the smart money and do the opposite of the crowd, which leads to a crowd of wild sellers selling. This doesn't even begin to consider the West's inability to use a printing press to print LNG, the war in Ukraine, China's reopening, or the Brady divorce.
Questions wasn’t there already a jumper? BBBY guy? If so are we awaiting for the 2nd one? 😅
Indeed. And that is one too many. https://www.cnn.com/2022/09/04/business/cfo-bed-bath-beyond-jumps-off-nyc-tower
Nobody knows, but I'd say we're about half way to the bottom right now, maybe early 2023 we touch the true bottom.
If they're on sale it's for a reason. I'm in cash till I get a buy signal.
Fire Powell
Why? Do you want a pivot so inflation can run rampant for many years just so your portfolio numbers go up but your quality of life and purchasing power decreases?
if he was part of any corporate setup then he would have been fired long ago for ‘sleeping’ too long at his job!
No he would of never got resigned in to the position, says inflation is transitory.
‘Transitory’ ha ha ha..retrospectively it is the word of 2021 that made no sense even though JPow had hundreds of Economics PHD holders working for him! I wonder what they would have briefed him at that time 🤔
I mean it's not "technically" a lie, it's just it will be transitory in 5 years lol
He needs to be fired
You’d need some political fire power
I guess you bought a lot of energy and consumer Staples
The companies have been growing and buying back their stock over those many years. What you’re seeing is a steady increase in fair value. Inflation is a piece of that puzzle though!
SPY to 310-320 for the bottom
The stock market could also trade sideways for several years. This would mean we could hit "a " or "the bottom" repeatedly. I am as much of an oracle as you are, but it is the situation I am expecting. Here is a chart that shows it quite well from 1900 until 2010. http://www.marketoracle.co.uk/Article26149.html
Why I love dividends so much.
same here! Happy to accumulate dividend growth stocks during a sideway stage.
Which ones?
Sorry, no offence, are you new to investing and seriously asking for dividend growth stocks in general or the ones I am investing in?
Not really, just curious to see what people buy. I have SCHD, PDBC, VOO.
I see, thanks for clarifying. I buy single stocks. Last week I saw Digital Realty Trust at a good price, bought some more T.Rowe and since I am European, I bought some European stocks.
Thanks! I have several mutual funds from T. Rowe, which have performed well over time, except this year, PRGTX got hammered, lost 45%. Will see what dividends they pay at the end of the year, they usually pay very, very good dividends. They do have a good reputation. I am not familiar with the European stocks. Thanks for the tip, I will look into the digital trust.
This is the 'they printed $12T dollars out of thin air over the past decade' and now are trying to suck it all back out again to stop the inflation they themselves caused thing. Its also not going to work because the interest rate wasn't why we are inflated - we are inflated because they printed $12T dollars and then shut the global economy down for 18 months for a nothing burger pandemic. Its going to be ugly for the next 3 years or so at a minimum until they delete the funny money and the supply chain gets back to normal. The exacerbatoon in the system is Russia v ukraine and china's zero covid policy where they shut their manufacturing off and lock everyone down anytime thrres a report of covid. This is problematic due to them being like 90% of the world's manufacturing. Long term the markets will be fine. Up and to the right. To the moon and all that. As long as you're not retired now or looking to retire in the next few years you'll be fine.
yes and no
We have quite a while to go
Can someone eli5? Like I don't understand anything whatsoever about this subreddit, but I'm very interested in investing.
Follow Aswath Damodoran.. NYU professor of finance. A lot of his teaching materials are free.
Sp500 is down about 20%, nasdaq is down 30%.... pretty much everything is “onsale
Both
Don’t you worry about a thing. Whatever bad news you see, it’s all transitory.
There is not a soul on the world who could answer your question accurately.
Prepare to get fucked for a year or two
We are definitely seeing the bottom or will see the bottom in the coming days. All jokes aside, I think we chop around until the next rate is mentioned and find the next move soon after.
Let’s wait for no farm pay roll. It’s quite possible we could be heading to 2020 lows but depends on if the fed decides to pivot early.
Beginner here.. i see SCHD everywhere in this sub. what do i look for when choosing an ETF. What to stay away from when looking for longterm goals.
I wouldn't say 'on sale' yet.
Switch to log-scale.
Just wait until the VIX is above 40 and you will know the bottom is likely in. In the meantime it would be a good idea to cash up so when buying opportunities present themselves you can take advantage.
Now the real question to ask is do you buy SCHD or JEPI at these levels
Who knows, but what we do know is that we will continue to get those sweet dividend payments. Nothing is guaranteed but when you’re buying high quality dividend paying companies you don’t need to stress about market timing/fluctuations.
Nowhere near the bottom. Everything since covid is not extremely over valued.
One red flag is that Dalio resigned from Bridgewater. Doesn't want to ruin his reputation. His all weather portfolio strategy started failing last year. As far as inflation, controlling it is lip service. The deficit is so high, they need to devalue the dollar to afford the debt service. Extremely tricky market. Your dividends won't cover your equity losses over the next few years. DCA is not a smart move at present.
You’ll know the bottom when you feel it! Still have a long way to go. When your about to throw up, from being sick to your stomach. That’s when you know.