Starting 401k near the highs in a bull market?

[heavenskrow]

A stupid question. You could also get hit by a bus in the morning.

If you're generally a fearful person - and it sounds like you are - then investing just isn't going to fit with your personality. Buy T-Bills, or stick your money under the mattress.

Yes I do agree I can get hit by a bus any morning, I can get hit by a sniper while walking down the street, a jet can crash into my house.... The probability is VERY VERY low, but I am always aware that ANYTHING can happen anytime.

Also quite the contrary, I trade futures, options, do muay thai, touge, etc... I'm just always aware of the risk and the unknowns in the market.

 

[shatteredx]

Well if the USA gets wiped out by nuclear war, even holding treasuries won't do you any good.

Just spend 10% of your paycheck on non-perishable food, bottled water, ammunition and vodka to trade with. Problem solved.

 

[heavenskrow]

You keep saying Japan from 1990. Did you look at my link earlier?

As a young investor, it is better for you to market to go down during the accumulation. Let's use the same Japan example. EWJ (japan etf) started in early 1996. Here is the chart.

View attachment 200077

What do you think? It has gone no where since 23 years. Let us say, if you started with $100 in Mar 1996 and invest regularly $100/ month there after. Check this portfolio growth

View attachment 200078

https://www.portfoliovisualizer.com/backtest-portfolio?s=y&timePeriod=2&startYear=1996&firstMonth=3&endYear=2019&lastMonth=12&calendarAligned=false&endDate=04/02/2019&initialAmount=100&annualOperation=1&annualAdjustment=100&inflationAdjusted=true&annualPercentage=0.0&frequency=2&rebalanceType=1&absoluteDeviation=5.0&relativeDeviation=25.0&showYield=false&reinvestDividends=true&symbol1=EWJ&allocation1_1=100

Still unconvinced?

Thank you, I will need to do my own backtesting I see. I want to see with my own eyes starting at 1990 and ending in 2009. But it looks convincing, for that I appreciate you doing this.

 

[ElCubano]

Well if the USA gets wiped out by nuclear war, even holding treasuries won't do you any good.

Just spend 10% of your paycheck on non-perishable food, bottled water, ammunition and vodka to trade with. Problem solved.

Antibiotics stock up on antibiotics.

 

[SimpleMeLike]

Like I said, in hindsight while we are at market peaks it's easier to say that. However can I see a backtest of investing near the end of 1990 in Japan and 2008 with 401k?
That's 18 years of dismal performance if I believe?

heavenskrow,
It does not matter, start investing your money and stop worrying about if it's market highs

Notice , noone has yet to say, "yes, wait for a market crash and then start investing" Everyone has clearly said to get started.

Doesn't matter if market is high or low, just get started. You don't know if crash coming or if market goes up 1000 points next month. You investing for the long term. This type of investing should be very easy.

ALSO, you missing good dividends every quarter. Forget this market crash stuff, it's bullshit.

 

[SimpleMeLike]

However can I see a backtest of investing near the end of 1990 in Japan and 2008 with 401k?

Sure, no problem. I am not sure why these two years are so important, but here goes. If the market crash tomorrow, what do you care for?

1. If I started investing a $1000 a month in VFINX Vanguard 500 Index Investor in 1990, I will have $2 MILLION right now. $348K invested.

2. If I started investing a $1000 a month in VFINX Vanguard 500 Index Investor in 2008, I will have $304K right now. $132K invested.

Both cases , making money.

https://www.portfoliovisualizer.com/backtest-portfolio#analysisResults

See for yourself. Nice and easy right. Get started.

 

[SimpleMeLike]

https://www.portfoliovisualizer.com/backtest-portfolio#analysisResults

@heavenskrow Play this calculator backtester here buddy. Each scenario you put in will be winner. You can't argue with these numbers and think on crash stuff, think on being millionaire now, for get market crash.

Use the trading on the side to make more money too but retirement money we don't mess around with. We can goof off with backtesting day trading stuff, but retirement, we can't bullshit around with that.

 

[ElCubano]

The bottom of a crash from my experience is violent as F&&K likely to spit you out and tear you up. It aint easy down there, to stay, hold or get puked out. Buying into a crash while bids are being obliviated is a sight to see.

 

[MKTrader]

Well yes in hindsight it would have been good to be investing in 2007 since look at where we are now in US markets. . But what if that had been in Japan in 1990 instead..... Anything can always happen in the market.

If you're that afraid of 1990 Japan (again, something that's never happened in the U.S.), just stay out of stocks entirely. You'd be screwed even if you wait for a 25% correction to invest.

 

[MKTrader]

The bottom of a crash from my experience is violent as F&&K likely to spit you out and tear you up. It aint easy down there, to stay, hold or get puked out. Buying into a crash while bids are being obliviated is a sight to see.

Again, this is a 401K. You buy at the close after the market. You're not trying to frantically put in orders during the day.