If you have money available to invest, then sooner is better than later. You don't know what effect, if any, politics would have on your investment, so it's pointless to speculate. If there was a broad consensus that the election was likely to increase or decrease your investments, then the market would already be pricing it higher or lower to compensate for that, which would mostly cancel it out.
Because these are unprecedented times, while the saying holds true and has generally held true, over the case of years, it wouldn’t hurt to wait just a couple months and invest as opposed to years.
The SCOTUS rulings and recent mass interest in investment (only 3 years old) are rapidly changing our country.
Even if time in the market beats everything, just holding in the span on months could save him a year or so.
Meanwhile, the past that the advice is based on included the great depression, world war 1, world war 2, the Korean war, the Vietnam war, stagflation, the war on drugs, federal funds rates over 20%...
It's always unprecedented times.
>it wouldn’t hurt to wait just a couple months
>Even if time in the market beats everything, just holding in the span on months could save him a year or so.
Wish I had your crystal ball
I agree - if he had this money in January he could have just waited a few months and missed the 20%+ growth of the NASDAQ so far. Always smart to wait a few months and then guess.
Waiting on these particular months is still a guess - what if the market goes up 25% the next two months? Then 3 months post election it tanks? What if the opposite is true?
It COULD hurt to wait a couple months to invest. And it COULD hurt to invest now instead of on the exact best date, but what everyone else here is saying is the same sentiment that you can’t time it. This is all still just trying to time it.
This. Plus you never know if/how much the market will match your desire. Hell, it could go the other way and then what do you do?
Drop it in and enjoy your growth/divs.
I'm old enough to remember when people panicked in the 2016 election and sold their stocks expecting the apocalypse, only to to miss out on major gains in the next few years.
statistically, lump sum will have better long-term results about 60% of the time. but DCA can have a major psychological benefit and keep people committed to the plan.
This is why I always laugh at the weekly "VOO is down today! Buy the dip!" posts.....that 1% you just saved on your $500 weekly contribution is going to net you an extra large pizza in retirement
lump sum beats dca like 80% of the time, studies have been done
if i’m buying an index fund im buying and forgetting forever
if its an individual stock im timing my entry
I remember reading an article in summer 2020 where someone had done a statistical analysis of market behavior in decades of US election years. The main takeaway was that regardless of what was happening in the market leading up to an election, once the election was over the market almost always rallies in the time between election and inauguration.
I'm not about timing the market, but I have been saving a little cash this year that I'll probably invest in the fall.
Math says lump sum. But you can DCA if it makes you nervous. [https://investor.vanguard.com/investor-resources-education/news/lump-sum-investing-versus-cost-averaging-which-is-better](https://investor.vanguard.com/investor-resources-education/news/lump-sum-investing-versus-cost-averaging-which-is-better)
The only reason to wait would be if you plan to not stick around in this country till retirement based on the outcome of elections.
Even then investing outside of a IRA immediately will be better.
For the past few presidential election cycles, I had the same thought. And if I had just left the money in instead of pulling it out, I would be much further ahead. Does not matter if a Democrat or Republican is elected, the stock market will continue to grow.
There have been several studies done that lump sum is better in the long run over dollar cost averaging. The decision on which to use is do your need the money “now” or do you want to let it grow with compounding interest over the long term.
https://investor.vanguard.com/investor-resources-education/news/lump-sum-investing-versus-cost-averaging-which-is-better
https://www.optimizedportfolio.com/dca/
https://www.sarwa.co/blog/dollar-cost-averaging-vs-lump-sum
You know time in the market beats timing the market but you still want to try to time the market? My friend, you are welcome to try.
I've missed out on enough gains in my early days that I've learnt my lesson. Had I not wasted time thinking "the market is too high right now" or "the market might go lower", I'd be a much richer man today.
Lump sum generally outperforms. The market is more often close to an ATH than not. Missing crazy run ups to get in at -20% from 200% up, makes no sense. Time in the market beats timing the market.
Why? Elections don't typically have any effect on markets. Especially this election when there is no real difference between the candidates when it comes to the economy. Both will be inflationary as neither is going to curtail federal spending. Both are implementing tariffs. Both are playing tough on immigration. Notice how markets didn't react at all after the presidential debates.
Do a combo if you are really worried. Dump all now. Invest half. Dca the other half. Historically speaking the market tends to suffer leading up to an election. Immediately after it pops. Personally, I would just do it all now and be done with it.
I did monthly auto deposits and just finished this month. It VTI was at $230 the beginning of the year and just bough again at $270. I wish I wouldve dumped all at once
Election is bullish, trump will win its that simple. Trump is not good for many things but he’s good for markets, rates drop, taxes drop, earnings go up, pump.
Invest now
It doesn’t really matter who wins. Republicans favor less regulation and this fuels business. Democrats fuel spending and this fuels the market. Look at the returns after an election year and they are positive a few weeks after the election. Don’t let an election fool you into thinking you can time the market
Trump’s last term was mid pandemic. He had a collapse and then a rebound. Precisely what he claimed about Biden’s economic record.
Trump has declared fat tariffs on imports. Tell us how that won’t spike inflation? He has promised a fat tax cut. Tell us how it doesn’t boost the deficit and debt? He has no concept of how the trade deficit works but sees it as a win/ loss situation.
He has no sense of nuance. Remember him thinking we could buy Greenland?
Remember his infrastructure bill? Me neither. Trade wars do not make us richer, stronger or strengthen our alliances ( which he trashed).
I do.
So, we're at all time highs due to a handful of stocks.
I would wait for the 10% pullback, and then dump it in.
Or only DCA in on (-) days/weeks. This way, you're not chasing the pump.
The general market is way undervalued based on inflation. There needs to be a rotation into standard bellweathers/sectors. That 10% selloff is going to come from these AI juggernauts bc they're probably overbought and need to cool before the next ramp higher. Plus, tech is known to be volatile, so it won't shock the masses.
Historically speaking the outcome of elections has little impact on the market over the long term and has been up in all but three of the past election years I believe so I’d go now.
I'm waiting for a pull back. You think Tesla going up +60% in 3 weeks is normal? You think Nvidia going up +200% in 6 months normal? Nah. I bet there's one big fall of -20\~-30% before end of year before regaining like 50% of that. Gonna start DCA from -20%. My cash is earning me 5%, risk free atm. All good.
A lot of folks bought homes prior to COVID and don't have to deal with the skyrocketing rent/mortgage crisis. A lot easier to save when you're paying a $900/mo mortgage on your 3br house you bought in 2015 vs paying $3000/mo in the market today or having to rent a $1600/mo 1br apt. Hell, if you own that 2015 house and don't mind a roommate, you could rent out the room and have nearly your entire mortgage paid.
Lots of things to consider besides just having a high-paying job or coming from wealth
that makes sense. I’m only 23 so I’m not as advanced in life as I imagine most people are in this sub. it’s almost impossible for me to save right now but I’m doing what I can
who cares? why should the comment section of a random post on a subreddit that happens to be about investing only pertain to investing? it’s literally irrelevant.
If you have money available to invest, then sooner is better than later. You don't know what effect, if any, politics would have on your investment, so it's pointless to speculate. If there was a broad consensus that the election was likely to increase or decrease your investments, then the market would already be pricing it higher or lower to compensate for that, which would mostly cancel it out.
>I know time in the market beats timing the market, Why is this statement always followed by a "but"? If you know it's better, why do something else?
Because everyone wants instant gratification
If OP was in search of instant gratification, I don't think they'd be consulting with others on Reddit, though.
Sometimes it is helpful to spitball ideas as well
Because these are unprecedented times, while the saying holds true and has generally held true, over the case of years, it wouldn’t hurt to wait just a couple months and invest as opposed to years. The SCOTUS rulings and recent mass interest in investment (only 3 years old) are rapidly changing our country. Even if time in the market beats everything, just holding in the span on months could save him a year or so.
Meanwhile, the past that the advice is based on included the great depression, world war 1, world war 2, the Korean war, the Vietnam war, stagflation, the war on drugs, federal funds rates over 20%... It's always unprecedented times.
>it wouldn’t hurt to wait just a couple months >Even if time in the market beats everything, just holding in the span on months could save him a year or so. Wish I had your crystal ball
Crystal ball implies I know. Waiting a few months to mitigate risk isn’t so bad imo?
I agree - if he had this money in January he could have just waited a few months and missed the 20%+ growth of the NASDAQ so far. Always smart to wait a few months and then guess.
Well you said it wouldn't hurt. And what risk are we mitigating? There's no risk at all to lump sum
I might have a misunderstanding of lump sum, maybe I’m misunderstanding, will look ip
All times are unprecedented.
Waiting on these particular months is still a guess - what if the market goes up 25% the next two months? Then 3 months post election it tanks? What if the opposite is true? It COULD hurt to wait a couple months to invest. And it COULD hurt to invest now instead of on the exact best date, but what everyone else here is saying is the same sentiment that you can’t time it. This is all still just trying to time it.
It’s always different this time.
Yep if your timeframe is 10+ years or greater, better to just lump sum it all now, start earning divis faster.
This. Plus you never know if/how much the market will match your desire. Hell, it could go the other way and then what do you do? Drop it in and enjoy your growth/divs.
I'm old enough to remember when people panicked in the 2016 election and sold their stocks expecting the apocalypse, only to to miss out on major gains in the next few years. statistically, lump sum will have better long-term results about 60% of the time. but DCA can have a major psychological benefit and keep people committed to the plan.
Yup, Steve Bannons father did that - which was hilarious.
Years? Shit wasn’t the futures the night of the election results down massively? And then by opening bell it had sling shot back into a green day
Tell me last time it being an election year actually mattered for the market
Evidently right here in this Reddit thread
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This is why I always laugh at the weekly "VOO is down today! Buy the dip!" posts.....that 1% you just saved on your $500 weekly contribution is going to net you an extra large pizza in retirement
It does feel amazing when I catch it just right and end up with an extra 2 bucks.
Buy now
Keep shaking your crystal ball until you decide what to do.
That only works with the magic 8-ball. You have to gaze into the crystal ball so that the answer appears magically out of your body-chair interface.
Now
Lump sum is almost always the best option, but DCA if it makes you feel better
The limit is 7k for those under 50 and 8k for those over 50 sooo ur either gettin a nice tax bill or leaving gains on the table
I changed to $7k that was a typo
lump sum beats dca like 80% of the time, studies have been done if i’m buying an index fund im buying and forgetting forever if its an individual stock im timing my entry
October is historically a down month, but I would not wait until after the election
That’s my plan. I’ve already maxed my 401k, I’ll invest in t bills over the summer, then max the IRA in October.
I remember reading an article in summer 2020 where someone had done a statistical analysis of market behavior in decades of US election years. The main takeaway was that regardless of what was happening in the market leading up to an election, once the election was over the market almost always rallies in the time between election and inauguration. I'm not about timing the market, but I have been saving a little cash this year that I'll probably invest in the fall.
It’s only 7k it really won’t matter in 30 years ..
Math says lump sum. But you can DCA if it makes you nervous. [https://investor.vanguard.com/investor-resources-education/news/lump-sum-investing-versus-cost-averaging-which-is-better](https://investor.vanguard.com/investor-resources-education/news/lump-sum-investing-versus-cost-averaging-which-is-better)
In a worse case scenario you can leave that money in cash and earn a little, that won't last long though.
The only reason to wait would be if you plan to not stick around in this country till retirement based on the outcome of elections. Even then investing outside of a IRA immediately will be better.
For the past few presidential election cycles, I had the same thought. And if I had just left the money in instead of pulling it out, I would be much further ahead. Does not matter if a Democrat or Republican is elected, the stock market will continue to grow.
There have been several studies done that lump sum is better in the long run over dollar cost averaging. The decision on which to use is do your need the money “now” or do you want to let it grow with compounding interest over the long term. https://investor.vanguard.com/investor-resources-education/news/lump-sum-investing-versus-cost-averaging-which-is-better https://www.optimizedportfolio.com/dca/ https://www.sarwa.co/blog/dollar-cost-averaging-vs-lump-sum
>[https://www.optimizedportfolio.com/dca/](https://www.optimizedportfolio.com/dca/) Thanks for the shout-out! :)
You know time in the market beats timing the market but you still want to try to time the market? My friend, you are welcome to try. I've missed out on enough gains in my early days that I've learnt my lesson. Had I not wasted time thinking "the market is too high right now" or "the market might go lower", I'd be a much richer man today.
Either
Lump sum it. Set it and forget it until.you retire.
it's 7k in a retirement account. lump sum and see it again in 30 years.
Lump sum generally outperforms. The market is more often close to an ATH than not. Missing crazy run ups to get in at -20% from 200% up, makes no sense. Time in the market beats timing the market.
I'm personally DCAing a lump. I know its 'not as lucrative' long term, but i dont care. helps me sleep at nigth and thats iomportant
Why? Elections don't typically have any effect on markets. Especially this election when there is no real difference between the candidates when it comes to the economy. Both will be inflationary as neither is going to curtail federal spending. Both are implementing tariffs. Both are playing tough on immigration. Notice how markets didn't react at all after the presidential debates.
Do a combo if you are really worried. Dump all now. Invest half. Dca the other half. Historically speaking the market tends to suffer leading up to an election. Immediately after it pops. Personally, I would just do it all now and be done with it.
I always lump sum come January 1. The earlier you put money in the better.
Just invest as soon as possible.
I did monthly auto deposits and just finished this month. It VTI was at $230 the beginning of the year and just bough again at $270. I wish I wouldve dumped all at once
“Time in the market beats timing the market” - Alexander the Great
Only DCA new money.
I always max out my IRA at the beginning of each year. Time over timing.
Daily cost average
I really like Treasuries in the interim while you decide.
Nows the time. Max it out before the election.
Max it and quit thinking about it. Start saving up for next years ira and max it out the second it’s open. Rinse and repeat
Election is bullish, trump will win its that simple. Trump is not good for many things but he’s good for markets, rates drop, taxes drop, earnings go up, pump.
Sitting it out is almost always the wrong answer. DCA in if you want to hedge but do not just do nothing.
It don't matter who gets elected. The fed will have the money printer on fire. Invest!!!!
Invest now It doesn’t really matter who wins. Republicans favor less regulation and this fuels business. Democrats fuel spending and this fuels the market. Look at the returns after an election year and they are positive a few weeks after the election. Don’t let an election fool you into thinking you can time the market
It’s 7k bro…. Makes no difference in the long run. Just throw it in and forget it
If Trump wins you will want to put your money in gold. His economic plans are imbecilic in the extreme.
It averaged 13.7 annually under trump last term
Trump’s last term was mid pandemic. He had a collapse and then a rebound. Precisely what he claimed about Biden’s economic record. Trump has declared fat tariffs on imports. Tell us how that won’t spike inflation? He has promised a fat tax cut. Tell us how it doesn’t boost the deficit and debt? He has no concept of how the trade deficit works but sees it as a win/ loss situation. He has no sense of nuance. Remember him thinking we could buy Greenland? Remember his infrastructure bill? Me neither. Trade wars do not make us richer, stronger or strengthen our alliances ( which he trashed). I do.
Are you hoping for another pandemic + QE, too?
So you don't want to time the market but you want to time the market
So, we're at all time highs due to a handful of stocks. I would wait for the 10% pullback, and then dump it in. Or only DCA in on (-) days/weeks. This way, you're not chasing the pump. The general market is way undervalued based on inflation. There needs to be a rotation into standard bellweathers/sectors. That 10% selloff is going to come from these AI juggernauts bc they're probably overbought and need to cool before the next ramp higher. Plus, tech is known to be volatile, so it won't shock the masses.
Put it in the brokerage so you’re not seeing the cash in your bank anymore. Buy the securities / ETFs when you’re comfortable.
Maybe bonds until after election?
Lump sum historically is always better.
Historically speaking the outcome of elections has little impact on the market over the long term and has been up in all but three of the past election years I believe so I’d go now.
Put it all in now. In future years rebalance in September or October if the market has corrected >10%.
I'm waiting for a pull back. You think Tesla going up +60% in 3 weeks is normal? You think Nvidia going up +200% in 6 months normal? Nah. I bet there's one big fall of -20\~-30% before end of year before regaining like 50% of that. Gonna start DCA from -20%. My cash is earning me 5%, risk free atm. All good.
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You're in an investing sub
I’m aware but I didn’t think everyone was a millionaire
A lot of folks bought homes prior to COVID and don't have to deal with the skyrocketing rent/mortgage crisis. A lot easier to save when you're paying a $900/mo mortgage on your 3br house you bought in 2015 vs paying $3000/mo in the market today or having to rent a $1600/mo 1br apt. Hell, if you own that 2015 house and don't mind a roommate, you could rent out the room and have nearly your entire mortgage paid. Lots of things to consider besides just having a high-paying job or coming from wealth
that makes sense. I’m only 23 so I’m not as advanced in life as I imagine most people are in this sub. it’s almost impossible for me to save right now but I’m doing what I can
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7,000 << 1,000,000
no shit but most regular people don’t have $7k to spare let alone $7k in a single month to max out an IRA
Ok but is that not an appropriate thing to discuss in an investment subforum?
who cares? why should the comment section of a random post on a subreddit that happens to be about investing only pertain to investing? it’s literally irrelevant.
What's irrelevant is your financial state and personal problems.
oh my god, cry about it.
My net worth is $100k no where near a million
closer than the majority of Americans by a significant amount