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by drawkbox 1501 days ago
The geniuses are the ones that regularly take gains when stocks are green for so long, and regularly buy on deep "blood in the streets" reds.

If you can successfully flip the colors, long green is sell, red is a sale, then you can beat the market in the only way small investors can. It is very difficult to do, because of that FOMO.

Some of the better stocks like Apple, Google, Amazon will be splitting in summer, that is a nice regular bump. Prices on some of these will never be this low again. Good time to start dipping buys into index funds (VOO, VTI, VOOG, VOE) etc if you can.
1 comments
tarsinge 1501 days ago
What is « long » green? How long red must be? There are no real signals here, you’re trying to rationalize gambling. Also even if you could perfectly time dips it’s not a good strategy https://ofdollarsanddata.com/even-god-couldnt-beat-dollar-co...
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drawkbox 1501 days ago
Long green > 1 year so it is long is when stocks have been green for a while or above where your exit / price point was set. I guess people here really dislike the idea of selling and profit taking gains regularly. [1] In no way am I saying don't buy regularly, just also sell regularly so you can get into buying opportunities.

Dollar cost averaging works best if you aren't selling off every downturn and every so often banking some profits. If the only time you are selling is in downturns then that is a problem, selling should be as regular as buying.

A bit surprised this is so controversial. Taking gains regularly, even if you leave some gains on the table is better than only selling in downturns which is what happens in massive pullbacks. The massive pullback reds are when you should have some on the sideline to invest.

The base is sell high buy low, easier said than always done but if you have a regular sell strategy then you can bank some of those higher points just like DCA gets you into some of the lower points.

This doesn't mean you shouldn't dollar cost average or buy the dip, it means you have some cash to invest when there are pullbacks to get in lower. This allows you to continue doing other price target strategies and dollar cost averaging etc. You want some money in cash to be able to get into buying opportunities, like right now there is massive sale due to selling.

Basically have a regular buy strategy and a regular sell strategy.

[1] https://www.investopedia.com/terms/p/profittaking.asp

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