Jump to content
House Price Crash Forum
Sign in to follow this  
crashmonitor

Averaging Down On The Ftse ?

Recommended Posts

Very difficult to know whether we have a hit a bottom at 6750-6800. My guess is Greece or Germany will bottle it and we will see some more can kicking and the FTSE 100 will be over 7000 before the year is out, probably much sooner.

In the meantime, having decided to stick on the fact that I have recently bucked the Market, I will average down from today

It rather cushions the blow of further falls, that may transpire, in the knowledge that when the FTSE revisits 7000 (and it will) then my fund will be up more than the dividends alone. Indeed averaging down should result in a better performance than the stockmarket side tracking or a lacklustre increase as the incentive isn't really there to buy.

So I'll increase my units by 5%, to cover the 5% fall since the peak, and indeed continue to do so on every 5% fall.

A mathematical system where at least you know your liability, even if the Market halves and a bit more full proof than say doubling up Nick Leeson style.

Edited by crashmonitor

Share this post


Link to post
Share on other sites

Well indeed there are other variables in play and oil is a biggie not least with Royal Dutch Shell and BP.

I still think the Grexit is being slightly over played. If the worst happens and Greece overplays its hand, it will be Greece that goes down. The European Central bank will ensure the rest of the PIGGs get favourable rates on their bond issues, even if that means QE2 on speed.

Meanwhile, I'm prepared for the worst and further downwards adjustments and further averaging if necessary.

The third geopolitical risk has got to be ISIS now. (certainly not Brexit, Cameron has made it clear that we are demanding little and he wants a yes) There again in the autumn it was Ebola, what happened to that.

Edited by crashmonitor

Share this post


Link to post
Share on other sites

I bought some shell. If the price goes down I will likely buy some more.

Anyway enough of my terrible share buys :P

I looked at a line on a chart the other day and it told me nothing! :P So, I'm going to guess that we could see a low of 6100'ish on the FTSE but will finish the year over 7000. 6 months to be proven right! :)

Share this post


Link to post
Share on other sites

I bought some shell. If the price goes down I will likely buy some more.

Anyway enough of my terrible share buys :P

I looked at a line on a chart the other day and it told me nothing! :P So, I'm going to guess that we could see a low of 6100'ish on the FTSE but will finish the year over 7000. 6 months to be proven right! :)

There's a lot to be said for averaging down, anybody that unwisely piled in in December 1999 and then averaged down to 2003 and again in 2009 would have actually done incredibly well by 2015...much better than the 60% return with dividends sticking (or more like 30-40% with management fees deducted). Indeed better than had the market merely moved sideways or gone up modestly to say 8 or 9000.

The point with being long is you have never lost, so long as you have the time and patience to stick it out until price revisitation. Unless you believe in total global economic meltdown and non recovery ever.

If it goes down to 6100 then up to 7000, that would work perfectly.

Edited by crashmonitor

Share this post


Link to post
Share on other sites

Create an account or sign in to comment

You need to be a member in order to leave a comment

Create an account

Sign up for a new account in our community. It's easy!

Register a new account

Sign in

Already have an account? Sign in here.

Sign In Now
Sign in to follow this  

  • Recently Browsing   0 members

    No registered users viewing this page.

  • Next General Election   91 members have voted

    1. 1. When do you predict the next general election will be held?


      • 2019
      • 2020
      • 2021
      • 2022

    Please sign in or register to vote in this poll. View topic


×

Important Information

We have placed cookies on your device to help make this website better. You can adjust your cookie settings, otherwise we'll assume you're okay to continue.