Buy low, sell high? No... buy always, sell when you need the money.

Discussion in 'Mutual Fund Investing' started by rob, Dec 11, 2013.

  1. rob

    rob Administrator Staff Member

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    I got this rather genius advice from redditor GT2860RS in /r/personalfinance regarding buying indexes and mutual funds:

    So rather than jump in head first, he suggested setting a time frame to begin committing money and invest in mutual funds on a schedule rather than all at once. That way, I'm balancing the risk of missing out on market gains while limiting the risk of an economic pullback, and will still have money to invest should the market sink and I'm comfortable/ready to plop it all on the table.
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  2. kyle1bb

    kyle1bb New Member

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    Sounds like good advice.
  3. mac266

    mac266 New Member

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    Yeah, keep in mind most mutual funds are an investment vehicle for those who do not want to spend the time to self-manage their portfolio. Someone does it for you, deciding what companies to buy stock in or which ones to get rid of. You don't really have any input into that, and can ignore it for the most part. Just read your monthly statements and take note of the fund's overall performance trends over periods of years and longer.

    The best way to approach mutual funds is to decide on one, give the administrator a starting amount (usually at least $500 or $1000), and then set up an auto-withdrawal from your checking account each month. You forget about it, and when you actually take a detailed look at the plan a few years down the road, you realize how much money you've stashed away!

    They are a great tool, like I said, for those who do not want to self-manage their portfolio. Self-managing (i.e. researching and deciding what stocks to buy or sell) is very time consuming to do it correctly.

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