5D·

If you only believe in momentum to a limited extent and are absolutely convinced of mean reversion, when should you set up savings plans on individual stocks?

Already at a plus of 3% or only at 5% or more?

What do the wise among you say?

I know your DCA thesis, but I'll tell you what you already know: It will go down again.

I'd rather suspend the savings plans, build up cash again and wait until it crashes again, when I can make individual purchases or set up savings plans again.

Another question that has nothing to do with this article. Why is $GIS (+0,67%) going so badly? Have we already seen the low point?

8 Comentários

Uwe@SchlaubiSchlumpf

In addition to mean reversion, there is also the random walk. Nobody knows whether mean reversion will come today, tomorrow or in 5 years' time. It could be even worse. If you make consistently poor returns over the next 5 years, you will also have mean reversion and still miss out on returns. Or even more extreme: the market continues to make average returns on average and the current overvaluation becomes the new benchmark. Do I believe that? Nope. Could it happen? Definitely. But I don't want to take the risk of not finding the right entry point for several years.

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Nick@Nick-investing

Make sure you don't fall out of a window. It's said to happen more often in Russia.

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value_seeker_@value_seeker_

There was once a really great article here - unfortunately I can't find it right now - that regular savings beat "dip" purchases in terms of returns.

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GerdaKommer🦛@_Hippo_

@value_seeker_ What a pity, I would have been very interested. Who do you think was the author? Maybe @DonkeyInvestor knows more? 🥹

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Pope Donkey XXI@DonkeyInvestor

@_Hippo_ nope, I don't know anything

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bull_investor_1998@bull_investor_1998

@value_seeker_ I find it hard to imagine I have always bought from dip. Finding the right time is almost impossible, as mentioned in some previous posts. The term dip is totally relative, it's always just a snapshot.
I therefore think that I am now also working with a savings plan

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userc818a6f2df6247c9@userc818a6f2df6247c9

When is a dip a dip and when is it a falling knife, at least when it comes to individual stocks that react? I find it difficult to distinguish.... some claim to recognize this.... but in the past my savings plan stocks have generated more returns than dip purchases. I am definitely not a trader, I know that by now. Nevertheless, I still hold cash, which I can now add to alongside savings plans in the event of an overall market dip, e.g. Russia in Ukraine, nuclear weapons threat by Putin, Asian dip last year, Trump madness in April....

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GerdaKommer🦛@_Hippo_

@Savvy_investor_2000

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