Do you time your buys? If so, how?

**nodoodahs** Mon Feb 13, 2006 2:10 pm

Do you time your buys? If so, how?
Do you time your buys? If so, how? And why?

"No" implies that, as soon as you finish your analysis and have capital available, you buy your target stock to the extent you have allocated capital.

"Yes" includes several choices. If you pick "yes" please expound.

**blast_investor** Mon Feb 13, 2006 2:37 pm

I put no here because that is what value investing is supposed to be.

It is "price" based , not market timing.

But value investing do have time frame. Time frame is determined by "catalyst".

Time frame is usually the "waiting time", typically is 1 year to several years. Warren Buffet time frame is decades.

If after several years of waiting, the investment does not work out, just sell and move on to other opportunities.

I know I am going to wait in years. Therefore, daily price up or down is mostly irrelavent. I do not care.

That "time frame" waiting time of course is not "timing" in your poll.

**balaoko** Tue Feb 14, 2006 12:56 am

I put yes with ta. Since my ability to analyze the fundamentals of a stock is still quite weak, I don't have enough confidence on the result of my fa. On the other hand, TA gives me a lot of signals in confirming the trend. so the combination of fa and ta is my current choice. I hope some day I can be confident on fa, but I am not expecting giving up ta because I am also interested in optoins, where ta is necessary.

**nodoodahs** Thu Feb 16, 2006 9:38 am

What is the theory behind "averaging in?" I'm speaking here about a predetermined decision to average in, and not an opportunistic doubling down when the price falls unexpectedly.

If I were truly agnostic about my entry price - that is, I believe it's a bargain right now this very instant, and the short term prices are unpredictable (by me), then I should go "all in" right now.

If I were to buy a little bit over several days or weeks, what does that imply? It implies a belief that the price is going down further, and I want to average down. This has a logical conflict with the belief that the short term prices are unpredictable.

There are no contradictions, only assumptions that are faulty. If you are averaging in, you must either believe that prices are predictable over the short term and the price is going down - in which case, you're misguided and should have waited to buy - or you must believe that prices are random and unpredictable over the short term - in which case, you're misguided for not having bought all of it at once, because the price in a couple of days or weeks is just as likely to be higher as lower.

Now let's talk about an opportunistic doubling down when the price falls unexpectedly. If you see this happening in your portfolio with any frequency, IMO you're misguided by not taking a look back at the technical analysis of the stocks you've purchased at the time of purchase - to see if you can spot the differences in patterns and indicators between the stocks that fell after you purchased, and the ones that didn't. In the future, when you want to buy a stock that "looks" like the ones you bought before that kept falling, maybe you should wait instead of averaging down - you'd save some capital that way.