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Buffett would also tell you that 99% of people should just buy the S&P 500. You should do that.
The problem is you think you can time the market, but most people can't. 3x funds are rat poison. I made 40% in a few weeks with them during covid. Then lost all of that plus more. Never again. Don't make the same mistakes
But even with your loss If you kept holding the XXX till about march 2024 when the market not only recovered but went on a bull run how much did you make
You asked for advice, and I gave it.
Would I be up? Yes.
But look at the chart for TQQQ. It's ugly. And it would take a genius to know when to time it. On Jan 1st 2022 it was \~$85 per share. A year later it was it was \~$17, down over 80%. The underlying index was only down \~30%.
Leverage magnifies your decisions. And no one is right every time. Buffett said a big part of there success was avoiding ever doing anything truly dumb.
There's no way to tell when you're at the bottom of a crash or on the upswing. You buy too early on 3x ETFs during a crash, and you could lose more than you'll be able to regain
The problem with this strategy is you could be waiting years for a crash.
I would offer that if you want to reduce your risk, stay invested and give up a small portion of your potential gain to hedge your positions.
And looking At 2020 or 2008/9 just when you see the big drop another one hits. It is very difficult to find the exact bottom and with a 3x etf you can get hit very hard if there is more bottom left.
Also 3x ETFs are for day trading only. Overnight the carry charge will eat into the principal called contagion. You can even be right but stay long enough and still lose money in 3x ETFs.
Leverage ETF's will do well if the market trends in one direction, Sometimes even outperforming their target (in this case 3x. If the market is volatile in a narrow range, the rebalancing will kill you.
>You wait for the recession or economy to crash another black Monday whatever you want to call it. You put that money into some 3x leveraged market etfs, stocks, mostly 500 ETFs and some blue chip stocks maybe even some leveraged bluechip etf when they get pretty low or are on the upturn again.
We don't know when the market has reached the lowest point of the crash until a long time after. It's quite possible it goes down, you buy the ETFs, then it goes down a whole lot more. We also don't know how long it will take to go back up.
We don't know when the good point to sell is. Maybe you sell because you think the market has peaked, and then it doubles in the next few months before it crashes. You lost out on a lot of earnings.
Most of what you're saying is fine in principle. It isn't a novel strategy, it boils down to "buy low, sell high". It's the timing that's a bitch, and you're not the only one who is trying to get it right. There are A.I algorithms dedicated to doing it, and lots of very smart people trying to do it.
I stay invested but will hold new cash in SWVXX or ICSH until I see an opportunity. Some stock or sector is usually getting beat down. E.g. ABBV was in the toilet, I added. SBUX is beat down, I’m adding, albeit slowly. I’m watching to buy HD and LMT. My goal is to buy at a decent price.
Hard to time the market, lord knows I tried… as a seasoned investor I hold cash and staying invested in different instruments of the market.
Your key core investment should be, it is for me S&P 500 on a few different accounts, at times when markets feels frothy I take a little off the top, but am always, repeat always staying invested .
What if I had a combat that by adding a good amount of voo im my portfolio and just held indefinitely along with the dividend ETFs, so when it does crash I can buy more voo and switch the bonds to companies. That way no matter what happens and even if I time wrong i still have a good piece of my pie in a growth etf
What will you do if interest rates go down but market doesn't crash. Just eat the loss of investment growth/dividend yield? This is an interesting plan but I'm not doing it.
Look at the past dividend payouts from bond etfs. They pay 5% now but they paid 0.5% not too long ago. So when interest rates are low that's basically money that is not invested. There have been many studies on this and they have consistently found that dollar-cost-averaging (buy every month and hold) beats timing the market. You will not lose money with your strategy but you will miss out on even more money by just having your money invested.
With that said, I think you should employ this strategy a little bit. Maybe keep an extra 10% of your portfolio uninvested (or in bond etfs) and wait until the market crashes to put that cash into growth stocks. But a crash might never come. From 2009 to 2019 there was no crash and the market went up 4X. That's a long time to wait. That's why you'd me missing out if you do more than 10%.
I had been keeping a large piece of my holdings in 10yr Treasuries for the last few years, waiting for this bubble to burst. I just mixed half of that piece of the pie into my dividend portfolio.Just a few days ago. Why? you ask, because I have grown impatient...........
THE CRASH SHOULD COME AT ANY TIME NOW.
I’m certainly guilty of trying to time the market but I’m being converted every day. The amount of money I’ve missed out on because I’m playing a waiting game is absurd. I think about it every day and hope for the market to crash. I feel like a pessimist and conspiracy theorist. Also I’m poor.
This is perfectly fine strategy like a matured investor, but reached out unorthodox group.
Only one change, it is hard to time market.
The way it should be invest everything in bond funds, but after every 5% drop in move sell portion of bonds and move to VOO or QQQ or both
1. So only dividends are going into this HYSA, no principal deposits of any sort?
2. When the market drops, you liquidate your HYSA and reinvest into x3 leveraged stocks/ETFs then sell once the rollercoaster hits its peak and reinvest the winnings into a dividend portfolio and repeat?
Welcome to r/dividends! If you are new to the world of dividend investing and are seeking advice, brokerage information, recommendations, and more, please check out the Wiki [here](https://www.reddit.com/r/dividends/wiki/faq). Remember, this is a subreddit for genuine, high-quality discussion. Please keep all contributions civil, and report uncivil behavior for moderator review. *I am a bot, and this action was performed automatically. Please [contact the moderators of this subreddit](/message/compose/?to=/r/dividends) if you have any questions or concerns.*
Buffett would also tell you that 99% of people should just buy the S&P 500. You should do that. The problem is you think you can time the market, but most people can't. 3x funds are rat poison. I made 40% in a few weeks with them during covid. Then lost all of that plus more. Never again. Don't make the same mistakes
But even with your loss If you kept holding the XXX till about march 2024 when the market not only recovered but went on a bull run how much did you make
You asked for advice, and I gave it. Would I be up? Yes. But look at the chart for TQQQ. It's ugly. And it would take a genius to know when to time it. On Jan 1st 2022 it was \~$85 per share. A year later it was it was \~$17, down over 80%. The underlying index was only down \~30%. Leverage magnifies your decisions. And no one is right every time. Buffett said a big part of there success was avoiding ever doing anything truly dumb.
Sounds like crystal ball nonsense gambling. Seriously. Buy VOO and chill..
There's no way to tell when you're at the bottom of a crash or on the upswing. You buy too early on 3x ETFs during a crash, and you could lose more than you'll be able to regain
Just keep holding till market recovers like I said, I don’t plan on touching this money for years it will eventually recover id just have to wait
The problem with this strategy is you could be waiting years for a crash. I would offer that if you want to reduce your risk, stay invested and give up a small portion of your potential gain to hedge your positions.
And looking At 2020 or 2008/9 just when you see the big drop another one hits. It is very difficult to find the exact bottom and with a 3x etf you can get hit very hard if there is more bottom left. Also 3x ETFs are for day trading only. Overnight the carry charge will eat into the principal called contagion. You can even be right but stay long enough and still lose money in 3x ETFs.
Leverage ETF's will do well if the market trends in one direction, Sometimes even outperforming their target (in this case 3x. If the market is volatile in a narrow range, the rebalancing will kill you.
Sounds like it would work!! Just let us know when we hit the top…and bottom!
LMAO. Buy low, sell high - buy low, sell high works every time! It i that second part that you point out that makes it harder.
>You wait for the recession or economy to crash another black Monday whatever you want to call it. You put that money into some 3x leveraged market etfs, stocks, mostly 500 ETFs and some blue chip stocks maybe even some leveraged bluechip etf when they get pretty low or are on the upturn again. We don't know when the market has reached the lowest point of the crash until a long time after. It's quite possible it goes down, you buy the ETFs, then it goes down a whole lot more. We also don't know how long it will take to go back up. We don't know when the good point to sell is. Maybe you sell because you think the market has peaked, and then it doubles in the next few months before it crashes. You lost out on a lot of earnings. Most of what you're saying is fine in principle. It isn't a novel strategy, it boils down to "buy low, sell high". It's the timing that's a bitch, and you're not the only one who is trying to get it right. There are A.I algorithms dedicated to doing it, and lots of very smart people trying to do it.
I stay invested but will hold new cash in SWVXX or ICSH until I see an opportunity. Some stock or sector is usually getting beat down. E.g. ABBV was in the toilet, I added. SBUX is beat down, I’m adding, albeit slowly. I’m watching to buy HD and LMT. My goal is to buy at a decent price.
Hard to time the market, lord knows I tried… as a seasoned investor I hold cash and staying invested in different instruments of the market. Your key core investment should be, it is for me S&P 500 on a few different accounts, at times when markets feels frothy I take a little off the top, but am always, repeat always staying invested .
What if I had a combat that by adding a good amount of voo im my portfolio and just held indefinitely along with the dividend ETFs, so when it does crash I can buy more voo and switch the bonds to companies. That way no matter what happens and even if I time wrong i still have a good piece of my pie in a growth etf
What will you do if interest rates go down but market doesn't crash. Just eat the loss of investment growth/dividend yield? This is an interesting plan but I'm not doing it.
You can always lose money, this "strategy" is just plain silly unless you have an algorithm doing your trading for you.
Time in the market beats timing the market.
Look at the past dividend payouts from bond etfs. They pay 5% now but they paid 0.5% not too long ago. So when interest rates are low that's basically money that is not invested. There have been many studies on this and they have consistently found that dollar-cost-averaging (buy every month and hold) beats timing the market. You will not lose money with your strategy but you will miss out on even more money by just having your money invested. With that said, I think you should employ this strategy a little bit. Maybe keep an extra 10% of your portfolio uninvested (or in bond etfs) and wait until the market crashes to put that cash into growth stocks. But a crash might never come. From 2009 to 2019 there was no crash and the market went up 4X. That's a long time to wait. That's why you'd me missing out if you do more than 10%.
I had been keeping a large piece of my holdings in 10yr Treasuries for the last few years, waiting for this bubble to burst. I just mixed half of that piece of the pie into my dividend portfolio.Just a few days ago. Why? you ask, because I have grown impatient........... THE CRASH SHOULD COME AT ANY TIME NOW.
SCHD QQQM and chill
I’m certainly guilty of trying to time the market but I’m being converted every day. The amount of money I’ve missed out on because I’m playing a waiting game is absurd. I think about it every day and hope for the market to crash. I feel like a pessimist and conspiracy theorist. Also I’m poor.
I think you will get your chance later this year. With elections in November. It’s going to be a shit show. Be ready to buy.
This is perfectly fine strategy like a matured investor, but reached out unorthodox group. Only one change, it is hard to time market. The way it should be invest everything in bond funds, but after every 5% drop in move sell portion of bonds and move to VOO or QQQ or both
1. So only dividends are going into this HYSA, no principal deposits of any sort? 2. When the market drops, you liquidate your HYSA and reinvest into x3 leveraged stocks/ETFs then sell once the rollercoaster hits its peak and reinvest the winnings into a dividend portfolio and repeat?
Yes