Are you waiting for the stock market to pull back before you invest?
Here are some thoughts on market timing and why I prefer to stay invested.
Just a glance at the price chart of a stock market index will tell you that stocks don’t go up in a straight line. Stocks go up in a zig-zag pattern, making peaks and troughs.
Wouldn’t it be wonderful if we could keep buying at troughs and selling at peaks? We’d all be extremely rich.
But the reality is it’s impossible. Even the best investors will tell you that timing the market perfectly is a pipedream. Yet, time and again, I still hear novice investors who are trying to do exactly that.
“The Stock Market Looks Expensive Now. Maybe I Should Wait for Another Day.”
This statement may seem innocuous and something that many investors are feeling now. It is also understandable.
“Wall Street makes its money on activity; you make your money on inactivity.”
Investors who are tempted to time the market should remember these wise words.
This article first appeared on The Good Investors and is part of a content syndication agreement between The Good Investors and Seedly.
TheGood Investors is the personal investing blog of two simple guys, Chong Ser Jing and Jeremy Chia, who are passionate about educating Singaporeans about stock market investing.
If you have any questions about this stock and other stocks in general, why not head over to the SeedlyCommunity to discuss them with like-minded individuals?
This article was originally posted on 8 July 2020.
Disclaimer: The information provided by Seedly serves as an educational piece and is not intended to be personalised investment advice. Readers should always do their own due diligence and consider their financial goals before investing in any stock.