SwirlyBanana
SwirlyBanana

Is market overvalued?

There is a saying that "when there is greed be fearfull and when everyone is fearfull be greedy". Now every tom dick and harry is talking about investing in market and earning great returns. Are we in a bubble ? There is no easy money in markets but currently u will get lot of advice on which stocks to buy from everywhere. What should one do? Pause SIP , remove all money from stocks park it in Liquid fund, FD, bonds, do nothing? Thoughts

11mo ago
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SleepyTaco
SleepyTaco

Another one is called ‘the greater fools theory’ - similar concept. In my view, keep sell price targets and keep booking profits once your investment reaches that target. Then reinvest if you feel there is more juice. Keep booking profits and keep eyes open for signs of a downturn so that your downside can be limited. However this requires very active portfolio management, hence I always suggest to outsource it to an expert and use your time productively in your areas of interest

SwirlyBanana
SwirlyBanana

I have strong interest in the market ..I work for the stock broking firm too.. however we are not allowed to trade actively and we are supposed to disclose all transactions

BouncyPotato
BouncyPotato

If the point is to reinvest, why book profits? Might be a stupid question, but I appreciate your input.

TwirlyLlama
TwirlyLlama

Don’t know about other things in your post But don’t pause SIP , the very purpose of SIP is that you do not have to take such decisions!
Big money is made by not timing the market but being in the Market .

SwirlyBanana
SwirlyBanana

I agree with what u are saying but times like now are unprecedented.. looking at the situation I am fearfull..

DerpyBoba
DerpyBoba
InMobi11mo

A friend is waiting for bear market from 2021 Jan. While I have Yolo-Ed SIP into index every week in that time span.

SwirlyBanana
SwirlyBanana

My worry is what if ur friend becomes right u will end up with zero or negative return in coming 2-3 years..

QuirkyQuokka
QuirkyQuokka

Statistically, no. On a decently long horizon, he will end up making more (atleast per history).

SwirlyBanana
SwirlyBanana

Has anyone tried timing the the fall and what was the outcome? I know it's dam difficult but is there any warriors who have done that?

FluffyCupcake
FluffyCupcake
Amazon11mo

Not exactly timed the fall, but tracked Nasdaq actively and poured money when it was local minima around end 22- beginning 23.

Similarly poured chunks when NIFTY50 made bottom in 2020.

Both such estimations boosted the XIRR very much.

SwirlyBanana
SwirlyBanana

What did u used to identify the temp bottom or minimum?

FluffyTaco
FluffyTaco
  1. Pausing an SIP is the worst mistake a retail investor can make

  2. If anyone knew if the markets are overvalued, they wouldn’t be here on grapevine giving advice about it. Even billion dollar hedge funds can’t give you a deterministic answer for this question

SwirlyBanana
SwirlyBanana

We don't have to be right to the tits.. we will be fine even if we are moderately accurate .. +-6 months

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