To Buy or Not To Buy
To Buy or Not To Buy
What to do with the stock market at all-time highs
What runs through your mind as the stock market continues to set new all-time highs like it has in 2024?
Do I buy? Do I sell?
This has to end soon and can’t continue.
I can’t buy now at all-time highs.
I missed this run, now I will have to wait for a better opportunity.
It can only go down from here, right?
I know you’ve had these thoughts run through your mind. They’ve run through mine. They cross everyone’s mind at times like this no matter how long you’ve been investing.
What if the answers to these are very clear?
Here is the chart that gives you the answer in black and white. There really isn’t a debate. It says to just keep buying.
Money invested when the stock market is at all-time highs has actually outperformed money invested on any given day.
To zero in one step further, here is another chart that shows the S&P 500 average performance a year following new all-time highs.
When you have a long-term time horizon longer than a few weeks or months, just continue to buy. Month after month, year after year. Then you don’t have to wrestle with the thoughts and questions above.
If you do sell, when do you get back in? The stock market doesn’t ever ring a bell and say ok it’s time to invest now, the coast is clear.
Lastly, a few years back Ben Carlson wrote one of the best posts on this topic that I’ve read called What If You Only Invested at Market Peaks?
The post was such a hit that he had a video created to visually explain it. It’s well worth spending the five minutes to watch it.
It’s really that simple.
The next time you think about what to do at all-time highs, remember this. There really isn’t a question. Just a very clear answer.
The Coffee Table ☕
- who writes had a beautiful post called My life in a thousand words. It’s about what may be important today, may not be tomorrow and the stages of our lives. A great piece of writing that really hits home.
I enjoyed reading Morgan Housel’s post, A Few Thoughts on Spending Money. These are right on point which is typical of Morgan’s writing. Another great one filled with timeless points.
Fast Car by Tracy Chapman has long been one of my favorite songs. If you have not seen the video of Fast Car being performed by Tracy Chapman and Luke Combs at the Grammys this past weekend, take a moment to do so. It may be one of the best things I watch in 2024. (Didn’t include a link as they’ve been removing the full length videos of it across the internet.)
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