Challenge: Can you time the stock market?

Discussion in 'Politics' started by HomeoftheJets, Mar 26, 2020.

  1. HomeoftheJets

    HomeoftheJets Well-Known Member

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    Here are two graphs. Both these crashes actually happened, and each one wiped out about 25% of the stock market's value. So the bottom of the y axis isn't zero. Also, the time scale is in months. On one of these, the correct decision going forward is to buy. On the other, the correct decision going forward is to sell. For which one would you buy, and for which one would you sell? (I understand there's more that goes into attempts to time the stock market than looking at charts. Having said that, the current state of the stock market looks almost exactly like these charts, and trying to time the current market is tempting.) When you've made your choice, here's the answer:

    The first graph is 1929. If you bought, you would have been wiped out in three years. The second graph is 1987. If you bought, you would have gotten a huge bargain.

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    #1 HomeoftheJets, Mar 26, 2020
    Last edited: Mar 26, 2020

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