What exactly does this term mean? I know a dip is a drop on price but from what price and how big a dip before you buy more? Is it a certain percent drop over a specific time? Maybe a drop below a certain moving average? Just trying to figure out a good rule of thumb.
thanks for what you know!
Here's my experience ...
Timing the market isn't a good plan.
Time in the market is a great plan.
Buy and own, that's it.
I wish I wouldn’t have used that method with Compaq Computer, Kinder Morgan LP, Stone/Smurfit and a few others.Originally Posted by TampaJim
Getting in is the easy part, knowing when to get out is when you have to have a professional fee for service advisor to manage your money. Sometimes losses are not bad if you take them for tax relief, but that is rare.
If you are buying individual stocks I think it is more important to buy it at a valuation you think makes sense rather than just buying because it fell from one price to another. Stocks can fall alot and still not be attractively valued. If a dip brings it into or near your price target it makes sense to buy it. In this type of market people buy the pullbacks because they think it will continue on the same trajectory going forward. So I think it sort of depends on your outlook on a particular investment as to whether it makes sense to buy the dip. Alot of people dollar cost average into index funds so they may just decide to make the monthly, weekly whatever frequency contribution when the market pulls back. This probably makes more sense with a fund rather than an individual stock.
Why did the stock dip? Did the stock drop because the overall market was down or was it company related. Something that I do is look at a historical chart to see what are the sizes of normal dips for a stock. If a stock has a history of dropping 30% once a year, then there's your answer. But it always boils down to do you think the price is cheap? And understand that someone sold you that share thinking the stock was still expensive.
Some people use moving averages, 50day or 200 day to buy on the dips. Sometimes they use price levels on a chart.
Thanos was the hero
I'll add one personal belief ... cheap is cheap for a reason, stay away.
I'm a buyer of quality stocks. But, of course, I'm a long range planner too.
Buying a "dip" in the market, brilliant. Timing won't be perfect, but it's OK.
Your timing on this question was excellent.The Fed minutes just freaked out the market, especially parts of the tech sector.
UH OH. talk about timing
So ask yourself, do you feel lucky?
Do you buy the dip? you could look like genius or a bag holder months from now.
Thanos was the hero
I couldn't help it, I bought TSLA. I actually bought yesterday also. NOT financial advice, don't follow me. TSLA could go down alot more and I would be fine. And if it goes down enough, another 50% or more and I get a margin call, I'll simply ask the wife for more money.
Thanos was the hero
If NVDA breaks below 200 I will be selling puts hand over fist. Not sure it will get that bad but I guess we will see.
I was thinking about you today Nitro. Was wondering if you have been selling calls lately
I sold one on KKR about a week ago at 85 strike expiring Feb 22. Wasn't much premium though and was doing it to gradually thin the holding. I have BX also so sort of wanted to get rid of KKR over time. I sold a bunch of puts though though expiring January 21 back in mid December. I hope they hit but the clock is ticking (Googl, NXPI, KMB, MMM, JPM).
I think Google and NXBI will be close, safe on the other 3
I definitely do not try and time the market. Not smart enough nor lucky enough for that. I own a few stocks with decent earnings. I am considering buying more of these shares when the price drops. My original question on buying the dips was a search for a general percentage drop before buying more. Thanks for all the answers. NitroZ7 has me looking at valuations which I am not very good at. Being 72 next month I'm going to slow down on investments and start spending some for adventures for the wife and I. Nothing too elaborate like a cruise around the world. Going to enjoy the healthy years we have left. Good luck to all in your endeavors. God bless the USA!
If you are interested in looking into valuations FastGraphs is doing a Value You series on YouTube. They have some finance and economics professors on talking about things like reversion to the mean and how to value stocks. It is free and definitely worth a watch. When you start looking at the market through a valuation lens and through historic pricing it can be eye opening and to be honest a bit scary.
Thanks. I'm headed to youtube.
I wish you and your wife the best, as you enjoy your healthy years.
I am almost 57 years old. I am trying to determine a good balance for my (60 to 80 years old) time on earth. How to balance earning money, saving/investing for future, and enjoying the time my wife and I have with good (or at least decent) health?
I admire you wanting to enjoy this time in you life and again, wish you the best.
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