2Yr·

𝑼𝒏𝒑𝒐𝒑𝒖𝒍𝒂𝒓 𝑶𝒑𝒊𝒏𝒊𝒐𝒏 𝒛𝒖 𝑺𝒑𝒂𝒓𝒑𝒍ä𝒏𝒆𝒏


Why the basic idea is good, but I cannot understand different variations

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1) Basic concept and why it would make sense if used as stated.


2) savings plans on shares


3) short-term savings plans


4) Savings plans During EXECUTION change


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1) 𝑫𝒊𝒆 𝒍𝒂𝒏𝒈𝒘𝒆𝒊𝒍𝒊𝒈𝒆 𝒂𝒃𝒆𝒓 𝒔𝒊𝒏𝒏𝒗𝒐𝒍𝒍𝒆 𝑮𝒓𝒖𝒏𝒅𝒊𝒅𝒆𝒆.


World ETFs rise over the long term. As long as our economic system is built on growth, it will stay that way.

Long term here means =/> 8 years. This works, among other things, because companies gain more in value than others (that go bankrupt) are worth.


Therefore, a savings plan on a world ETF makes a lot of sense, because in the long term the prices are higher than the purchase value and timing is difficult.



2) 𝑺𝒑𝒂𝒓𝒑𝒍ä𝒏𝒆 𝒂𝒖𝒇 𝑨𝒌𝒕𝒊𝒆𝒏


Provided one takes the significantly higher risk and invests in individual companies.

Do savings plans then still serve the purpose of achieving an average entry point? Yes.

Just as with the ETF, does anything prove that this stock will go up in the long run, so does an average entry point bring you anything?? NO.



Does it therefore make sense to buy batches at random times ? Nope.

What do I get out of a permanent savings plan on something of which I do not know whether it will bring me long-term returns?


Everybody knows the 2 statistics

I : Market timing does not work better than buy and hold (for a large part of investors)

II : Stock picking does not work better than the broad market (for a large part of investors)


So if you buy individual stocks, you assume against the statistical average probability that you are better at the big game of the stock market than many others.


Nevertheless, some then decide to let good buying opportunities pass in favor of monthly fixed buying times.


Even without TA knowledge or the like; buying when prices are cheaper and waiting when prices are expensive (at ATH) is the only way to make money with individual stocks even over bear phases.


Then beating the market is one thing, but over 20 or more years to find the few stocks that always beat the market on average over time (= run savings plan on these stocks), is an even more difficult task.


No strategy makes sense anymore if savings plans are used; for example the deep value strategy of Charles Munger is completely invalid, as it says that you buy when prices are falling, if the intrinsic value is higher.


Single stock strategy = timing.


So why use it? Either one invests passively with little risk or one invests actively, to invest passively is perhaps not so bad in Bull times, but in every other case simply only gambling.


An investment does not become less risky if one follows the statistical recommendations partly observed.


Conclusion: Actually nonsensical, if you are too impatient to wait for opportunities and always have to keep your money in some stock, you should not create a savings plan (then you actually have nothing lost in investments in individual stocks).



3) At this point, nothing is really rational anymore:

𝑺𝒑𝒂𝒓𝒑𝒍ä𝒏𝒆 𝒊𝒏 𝒆𝒊𝒏𝒆𝒎 𝒌𝒖𝒓𝒛𝒇𝒓𝒊𝒔𝒕𝒊𝒈𝒆𝒏 𝒁𝒆𝒊𝒕𝒓𝒂𝒖𝒎 𝒍𝒂𝒖𝒇𝒆𝒏 𝒍𝒂𝒔𝒔𝒆𝒏. (Or in addition to savings plans re-buying, partial selling, etc).


I already find savings plans on shares pointless, but if they are then only executed in the short term (3 months, 1 year, something like that), I no longer even understand the original basic thesis?

The intention of savings plans should be first of all the avoidance of market timing, by savings plans that only last a short time or only fill a certain position size, you don't achieve EXACTLY THAT!

Definition of successful market timing: the attempt to achieve above-average profits by purchasing at a subjectively selected point in time.


Let's say a stock goes public in 2010. It is bought out again in 2050 and taken off the stock market. I bought in 2 batches 2020 and 2021, Max had a savings plan going for 10 months in 2020.

Both equally: Market timing.

The short and medium term average does not have to be advantageous for the investor in the end for shares in any case.


So if you run a savings plan only temporarily, you yourself recognize that it makes sense to time the market, but do not really want to admit it? Or how?


Some had even in the 2021 Bullrun savings plans run, the positions now run into the minus and it is no longer re-bought.

Because the "positions are now full".




4) 𝑾ä𝒉𝒓𝒆𝒏𝒅 𝒅𝒆𝒓 𝒃𝒆𝒈𝒓𝒆𝒏𝒛𝒕𝒆𝒏 𝑳𝒂𝒖𝒇𝒛𝒆𝒊𝒕𝒆𝒔 𝒆𝒊𝒏𝒆𝒔 𝑺𝒑𝒂𝒓𝒑𝒍𝒂𝒏𝒔 𝒅𝒊𝒆𝒔𝒆𝒏 𝒗𝒆𝒓ä𝒏𝒅𝒆𝒓𝒏. 𝑶𝒅𝒆𝒓 "𝒇𝒓ü𝒉𝒛𝒆𝒊𝒕𝒊𝒈 𝒔𝒄𝒉𝒍𝒊𝒆ß𝒆𝒏"


Now let's see that in point 4) everything from 2) and 3) is true.

If you plan to save on a stock (for whatever reason) with a time-limited savings plan (for whatever reason) and then cancel the whole thing, for example, after a price drop...

Is the savings plan then used for anything other than avoiding the purchase fees?




𝑭𝒂𝒛𝒊𝒕, if you have other arguments feel free to post in the comments:


Savings plan on World ETFs for low risk ✅

Savings plans on shares ❌


#learn
#opinion
#personalstrategy

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91 Comments

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Aha 80% All World suddenly not so unsexy after all? 👀🤡
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@Lorena With your stock picks certainly better 🤡
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@KapriolenSonne just be quiet 🦍 he who sits in glass houses....
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@Lorena is just safe safe is not stupid but sexy now also iwie not
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@Lorena He's in a glass house 🦍
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@getquin with VR?
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that escalated quickly 😅
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@leveragegrinding I think someone has pressure 👀
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Savings plans to invest in overvalued tech bucks 😇 If you can't afford a whole stock one time investment + savings plan to buy the dip🥴 Savings plans to use your remaining money onm clearing account, nvm that can also go to waste
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@getquin with overvalued tech stalls you go all in or not at all. Your risk avoidance pisses me off
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@getquin Who does not honor the stupid lever plays is not worth the insolvency - @PleiteZwegat, sometime
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@getquin why not just buy more when the dip is there? instead, always wait like a monkey for the 16th?
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2Yr
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@getquin now.🚀
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@getquin yes but is then only a 15tel of the posi otherwise it would have been vllt a quarter or so
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I also don't think much of savings plans in individual shares. I therefore think your thoughts are good 👌 @ccf
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In principle, I agree with you about the holding period, etc.. However, savings plans on individual stocks are not only made nowadays to avoid market timing, but also because there are many popular individual stocks that most people cannot afford to buy as whole shares. If I want to participate in Amazon or Alphabet, for example, and I'm not exactly among the top ten thousand, I can't do that without savings plans. Personally, I'd like it if - as with cryptocurrencies - it were also possible to buy shares of individual stocks outside of savings plans. For a fee, if you like...
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@DerLeeh you can do via eTorro. They are fractional shares for derivatives.
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@Pat83 Then again, I don't want that either. So I'd rather just run the savings plans. 😏
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@Der_Leeh so I am not one of the top 10,000 and have "treated" myself to a total of 4x Amazon and 1x Alphabet (last, in March 2022). Apart from the bad time to buy: it wasn't a Lindt share. If you do not yet have a family and earn at least average, it is already possible mMn. Of course, diversification is then more difficult. But there are not that many share prices > €1,000.
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@KevinC Kevin...🙄 Now that both mentioned "only" cost <100€, I can also "treat" myself to whole shares. But the post is from the time, before the last stock split. Since the value of the Alphabet share was still around 2.2k and the Amazon share around 2.4k...😉
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@Der_Leeh if you had read my comment correctly, you would also have seen that my purchase time for both shares was before the split. With 10€ order fee I never buy below 1k€.
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@KevinC Accordingly, I now have 80x Amazon and 20x Alphabet in my portfolio.
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@KevinC Respect for anyone who can do it. I have two children and a house and car to pay off. That's why I can only invest in somewhat smaller steps, but over time it will be worth it... 😏👍🏻
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@Der_Leeh Paying off children is also good😂😂
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@KevinC @Der_Leeh I was also only interested in savings plans that run for years and are then canceled. With shares that you hold for 40 years, a savings plan over 10 years makes just as much sense as 3 one-time purchases. Both are market timing :)
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@Der_Leeh All good, I also see a loan for my own property as an investment, even if it's more of a "feel-good" investment. I will also have to reduce my savings rate as soon as I have kids. It's about time, I'll be 33 soon.
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So rather like 80% of users here once a week ask whether you should wait for a setback or rather buy directly? Rather collect the money in the account for months? I use savings plans now for the beginning to build up positions and later, when the money sits a little looser in individual purchases to switch. When Telegram group for buy signals? I think for people who want to run the stock market on the side, a savings plan is a good means to an end, who is active in the stock market, who will be more likely to take your opinion 👍
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@DiFigiANo that's exactly the point, I think it hardly makes sense if you don't have the patience or time to invest in individual stocks. So 🤷🏽‍♂️
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I have 4 savings plans on ETFs - I don't use single stock savings plans anymore, EXCEPT: if a stock is too expensive for me (>2k at Amazon or similar) I buy a fraction of it via a one-time savings plan, because fractions are not possible as single purchases at TR/Sacalble.
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@boersen_student that is the only sensible justification.
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What's wrong with first building up a few positions with stock savings plans? Personally, as a student, I can't just put aside hundreds of euros. That's why I prefer to steadily build up my portfolio in the form of savings plans.
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@Syncto Well, if you run the savings plans on a world etf, there's nothing to be said against it. But you can also simply hold on to the money on shares and try to buy at a lower price. The risk does not increase.
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@leveragegrinding I still have 3 ETF savings plans running on the side, but I want to build up my assets over the long term and not necessarily make money in the short term through price fluctuations. That's why I can just push the money into the stocks via a savings plan, because I want to invest for the long term. Do you understand what I mean?
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I actually only use savings plans to empty the clearing account of my securities account. Everything else is done via individual purchases
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2)is the classic "I want risk" and it can pay off. 90% of us would be better off if they would just save the ACWI. But then where is the appeal 3) Can be useful if you want to take advantage of the market situation but do not have enough money for a whole stock. (Alphabet falls by 30% costs but still no idea 2000€ - savings plan pure zack ready)
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Achso and @ccf so that the man in March can also get a savings plan xD
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@SharkAce yes, but 3) ONLY THEN . otherwise you are just trying to lie to yourself that you will earn the right to your income with the savings plan.
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@leveragegrinding Yes if you do not keep the savings plan and do not sell the stock already a bit lost. Either you lie to yourself and operates eigl market timing or you have no fixed savings aka the money is not enough every month
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So... The way I do it is to invest 1/3 of my savings rate in a "boring and very unerotic 70/30 portfolio". One third to make sure that if I'm wrong about individual stocks, I still have a more than good backup. The other 2/3 I invest in individual shares when I think I have found a suitable investment opportunity. Since an index can often be a blessing and a curse at the same time - because it always contains companies that you wouldn't buy if you had analyzed all the companies it contains - I also try my luck with individual stocks. I generally try to invest around €1000 per position in an individual share. I also use savings plan purchases for individual shares. My reasons are, for example, situations like with Nvidia... no suitable entry point for a long time and to reduce the risk. With Sea I recently did it exactly wrong and am currently paying more or less for it... but so be it... Another situation in which I use a savings plan is when the shares are worth more than €1000 each, as I can't buy fractions in a one-off purchase... All in all, I find that this makes it easier to track and or time the price or further purchases. Of course, I understand that not everything conforms to theory... but this is the solution I feel most comfortable with and that's more or less what it's all about...
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So if someone has had monthly savings plans on FAANG shares for the last 15 years, they will probably have outperformed 99.9% of the people on Getquin. So I think your post is far too generalized...
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@Zackdela79 if someone had invested in faang stocks at some point in the last 15 years, even without savings plans, they would have outperformed everyone.
Did you read the post?
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@leveragegrinding If you only put 300 eur a month into the savings plan over 15 years, that's 54,000 eur. Do you think everyone has that lying around somewhere all at once? Your post is far too one-dimensional and cheap.
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@Zackdela79 very clever. If you leave the 300 euros lying around for 15 years, you'll have 54000🎉🎉🎊🎊🎊
Turn on your brain, then comment. Thank you🖤

Savings plan+ world etf = safe
Savings plan+ shares = not safe
Individual purchase+ shares = not safe

Shares do not become less risky just because you use a savings plan.
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@leveragegrinding I think we're completely talking at cross purposes. With the EUR 54,000, I was only concerned with the fact that most people probably have EUR 300 a month at their disposal rather than EUR 54,000 in one go. But it doesn't matter, you don't always have to agree...
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I have had difficulties putting money "aside". That's why I had to finance two real estate purchases at 100%.
Thanks to the savings plans on $EUNL and three other ETFs that pay good dividends but don't rise in price as much, I managed to put 10k "aside" within 8 months.
After the corrections of the last few weeks, I am only slightly in the black and have therefore hardly or only slightly increased my money status quo, but if I hadn't had the savings plans, the money would have sunk into the consumption hole.
I share your opinion on savings plans for individual shares. If I want to invest in individual shares, I wait for favorable entry prices and study the stocks. With an ETF, someone else does that for me. In my opinion, that is also the purpose of a savings plan.
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How do you see using savings plans as a way of achieving an even weighting more easily?
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@Lorena Weighting of what?
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@leveragegrinding na of the individual shares
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@Lorena uhhh ?
Why do I need savings plans, they only make it more complicated?

If I have analyzed a share, I know at what price I would buy it
I generally don't see the point of a savings plan 0
If you have money again every month, then I would wait until the time to invest has come again or consider whether it is worth buying more in the current situation
You just need patience
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@leveragegrinding Yes, I am now looking to buy more. You are always obliged to monitor the market on an ongoing basis. The question now is -> the time I lose by waiting for a correction. How relevant is that? With my talent for buying at ATHs, it's really great 😵‍💫
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@Lorena so all this talk about it not being relevant if the stock is much higher in 20 years is also nonsense. If you buy AMZN now at its high and it doubles again, you have a profit of 3700$.
If you buy now in the correction at 2800$ and it rises to the same level again, that's almost 140% profit.
https://www.tradingview.com/x/52LY2hxE/
Buying at the ATH is simply not a good idea, it only makes sense for very small stocks. There is actually always a better entry point than the current ATH

e.g. here, everyone was afraid of missing out, not a few asked here at 300 still at gq why everyone wasn't buying. The only ATH at NVIDIA where it would have been worth investing was at the end of July, no correction has gone back that far.
I never buy at the ATH because a missed profit is less bad than a probable loss.
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@leveragegrinding I find the principle of catching the correction difficult. Or rather the confidence, because I'm not the most decisive. If FOMO kicks in and all that :) well, let's think about it. First of all, move the portfolio over
Regarding the share savings plans: Perhaps simply out of fear of falling prices or uncertainty as to which direction the market will take this year. I've only recently started looking at individual shares and have actually recently started a share savings plan on Microsoft. Simply because I can't time the market.

The plan is to hold Microsoft forever, so it probably doesn't matter whether I get in today with a one-off payment or divide the payment by 12, but for the mind, especially as a beginner, one-off payments when it corrects a few % straight away are really not that cool. You have to learn to deal with that first. After my first savings plan, for example, things went down by about 10% by the second, so you're happy that you bought at a good price. If the 10% had happened now with a one-off payment, I'm sure many would have panicked straight away and done something else.

To summarize, I think it's a good way to get to grips with individual stocks. But I'm happy to be convinced otherwise and perhaps change my strategy.
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Since you cite the "science" in your post... it also says that it is more worthwhile to be 100% invested than to hold cash to wait for a "dip".

That's why savings plans make sense, even on individual stocks! If you like the companies and want to sink your money into them every month, there's nothing wrong with that, is there? You often save on fees this way.

So whether I invest €500 every month in e.g. MSFT butter via a savings plan or by buying individual stocks is Wayne?
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@UweHasslerAktien Have you read the article?
The statistics say that it always makes sense to invest in world ETFs. Nobody talks about this for equities. It doesn't make sense to simply assume that.
And just because you like companies doesn't mean you should invest in them...
But go ahead with your savings plans, I was already aware that it remains an unpopular opinion
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@leveragegrinding I personally don't use savings plans and I agree with you to some extent. However, for individual stocks it is still right to remain fully invested. As long as it's a good stock that yields a return, but that's a basic assumption for buying.
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Basically, I agree with you, BUT I am a student and can put aside around 50-100 euros a month. I have been thinking about a lot of shares for months and have been saving a total of 40 euros for 21 companies since then. Thermo Fisher, ASML, Costco and Broadcom are financially impossible for me to buy other than as a savings plan. Especially as I am also weighting and Costco is relatively low (approx. 3%). However, I have to admit that if I have more than €40 left over, it usually goes into the ETFs that I then buy once (not as a savings plan)
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