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by bumpkinjunkie 2273 days ago
I am careful about giving financial advice to someone asking about timing the market. Things that might be helpful to ask first.

1. What is it about ETFs that makes you ask the question? Do you know what an ETF is, what it does, and what other financial products are out there that do similar things and how much they cost (fees)?

2. There are so many resources on the internet. I would say it's good to understand concepts like: Dollar-cost averaging, portfolio diversification, investment horizon, risk aversion. Most introductory investing resources would cover these things.

3. Think about what your short, medium, and long term cash and liquidity needs are to help determine how much you need/want/can invest. Remember, you can probably sell and get some money back, but it could be at a loss.

In summary, one could argue that it's always a "good" time to invest. The questions I would ask are "in what", "how much", and "how long".

2 comments

This is a perfectly written response, as opposed to an "it's impossible to time the market" canned reply.
I agree with the above. Additionally: know what you are buying and know the rules.

For example, a less sophisticated instrument is a stock. Why does a stock have value? What do you get in exchange for money? Why are companies incentivized to care about stock prices? Why are stable companies often devalued if they have less growth potential?

These seem like basic questions, but if you think about any one of these they are not easy to answer.