Is now a good time to buy the dip?

Question

The stock market took a big hit last week.

We are all RE investors but many of us also invest in the market.

Personally I use a set it and forget it approach - monthly auto deposits into 2 accounts: an IRA and a 529 (both Vanguard).

However I do like to do some extra buying when I think the market makes a temporary yet significant drop.

So is now a good time to pump some extra money in?

Or do you think it will go down more before it goes up?

Ryan Freet · Answer

Ahh, that makes sense. If you are looking at a long position in these funds then I would say putting more money in makes sense over the next month. However given the upcoming presidential election and all of the uncertainty I believe there will be substantial volatility through that period. I divested a great deal of my holdings over the past year with the intent of putting them back into the market sometime in 2021.

Max T. · Answer

What’s the market doing today?

What are you doing about it?

Max T. · Answer

Thanks Ryan. My post above was not about investing in specific companies, rather, index funds that track the market as a whole.

Ryan Freet · Answer

I've always subscribed to the notion that it is not wise to try and time the market. For the same reason RE investors preach the difference between a $30k property and a property which is selling for $30k stocks should be treated the same way. If you believe a company is strong enough to invest in, purchase shares at predetermined intervals over the next 2 or so months. Controversially a dip in the market and the increase in perceived "value" doesn't suddenly make a bad company good.