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Response to progree (Original post)

Thu Dec 2, 2021, 07:29 PM

4. It may, or may not be, good timing to invest at all time highs

While many an all time high is made in an uptrending market, there are investment books that take the long term perspective and advise caution. Individual stocks can outpace every type of investment if the growth is strong. But it is also the case that indexes are average. There were all time highs that preceded market tops - 1929, 1968, 1987, 2000, 2008, and the recession of 1973-75. These were significant market top events. Investing at a true market peak, is, as economist John Hussman often writes, an event that can take a decade, or two, to again attain the levels of that market top. Which means being underwater. Buying the dip is a frequent strategy, and one that works, but at small discounts to market peaks it can spell vulnerability. Market averages did not recover their previous highs following those market peaks for many years ... such as 1941, 1981, 1993, 2008.

Paying an inflated price is no way to buy a car, a house, or investments - if the intent is to make money. Timing is as important as the price paid.

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