Very insightful for a ‘newbie’ in the crypto world, learning how to not get caught up in impatience is the hardest part. It is how you said it - ‘ Better late to the party than to show up to the wrong one’. Thank you for this one :)
Patiently dollar averaging a monthly amount into general indexes. Researching ETF's/stocks for industries having a hard time now, but set to recover when things clear up (eg. automotive, travel, metal). Any thoughts?
Hi Izero, the main two thoughts that come to mind, but this is a matter of personal preference and by no means 'exact science', for me are:
1) When it comes to timing, instead of dollar cost averaging, I'd rather wait for a clear sign that the market is turning. That could be in the form of 'capitulation' or in the form of Central banks pivoting their stance again, and then start buying again. But to be clear, I don't think there's anything wrong with DCA'ing now, I believe the market will trade higher, certainly the US indexes.
2) As for which industries to pick, my personal preference is to pick the strongest performers, rather than the 'beaten up laggards'. Both have advantages and disadvantages, but the former is more in alignment with the market's overall opinion. By buying a beaten up sector, you risk under performing the index for an undetermined period of time. For example, Gold is at the same price level as 10+ years ago. So, sure they could bounce back, but will they yield higher% returns than Tech, or Energy, or even hand-picking technology of the future (VR, AI,..whatever you choose to focus on) and placing your bets on some companies in that sector. By buying strength, you get immediate feedback from the market and are 'surfing a wave', rather than waiting for a wave that is yet to come, or, worst case, perhaps never comes in the way you expect it. You can just hop on when it arrives:) Hope that helps!
Very insightful for a ‘newbie’ in the crypto world, learning how to not get caught up in impatience is the hardest part. It is how you said it - ‘ Better late to the party than to show up to the wrong one’. Thank you for this one :)
Thanks Aïcha, i'll make sure to keep 'em coming in the next few weeks, times are very interesting:)
Patiently dollar averaging a monthly amount into general indexes. Researching ETF's/stocks for industries having a hard time now, but set to recover when things clear up (eg. automotive, travel, metal). Any thoughts?
Hi Izero, the main two thoughts that come to mind, but this is a matter of personal preference and by no means 'exact science', for me are:
1) When it comes to timing, instead of dollar cost averaging, I'd rather wait for a clear sign that the market is turning. That could be in the form of 'capitulation' or in the form of Central banks pivoting their stance again, and then start buying again. But to be clear, I don't think there's anything wrong with DCA'ing now, I believe the market will trade higher, certainly the US indexes.
2) As for which industries to pick, my personal preference is to pick the strongest performers, rather than the 'beaten up laggards'. Both have advantages and disadvantages, but the former is more in alignment with the market's overall opinion. By buying a beaten up sector, you risk under performing the index for an undetermined period of time. For example, Gold is at the same price level as 10+ years ago. So, sure they could bounce back, but will they yield higher% returns than Tech, or Energy, or even hand-picking technology of the future (VR, AI,..whatever you choose to focus on) and placing your bets on some companies in that sector. By buying strength, you get immediate feedback from the market and are 'surfing a wave', rather than waiting for a wave that is yet to come, or, worst case, perhaps never comes in the way you expect it. You can just hop on when it arrives:) Hope that helps!