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Should I start investing now or wait?

In the last post should I sell my stocks? we looked at whether you should get out of stocks and bonds now – if you already have a sizeable investment portfolio.

In this post, we will look at whether you should start or continue to invest in stocks and bonds considering the current market position. The short answer is…YES, but let’s have a look in a little more detail.

Market Performance 2022

By all measures 2022 has been a tough year for investors. Stock markets are down, and global bond markets are seeing potentially their worst performance in history.

Global equity index fund.

Gradragstoriches two preferred funds; Vanguard FTSE Global All Cap Index Fund and Vanguard Global Bond Index Fund are both down year to date October 2022 - 10% and 14.5% respectively. Does that mean we should wait to invest?

Global bond index fund.

Market Timing

Should we wait until the stock markets start to go up again, or wait until they reach the bottom? It’s human nature to feel safer buying into a rising stock market, but this means we are waiting for ‘the product’ to become more expensive before we buy it! This defies logic.

On the other hand, we don’t want to buy only to see the value of our purchase go down in value. We fear loss more than we enjoy gains.

But which way will the markets go? If you look at the graph above of Vanguard FTSE Global All Cap Index Fund, could you have ‘forecast’ that the price would go up from June 2022 – when the trend all year had been downwards? Could you have guessed that the price would then fall from August to October? Where will it go next?

Timing the market is notoriously difficult. You will find lots of advice in the media from ‘experts’ that know the markets have ‘bottomed and about to rise’ or ‘the biggest crash in history is about to happen!’, but unless they have mastered reading the future from a crystal ball, even they are taking ‘educated’ guesses.

If you wait for the day you are ready to invest, then you are never going to do it.

Case Study: The Financial Crisis 2007

Extract from an article on written by Evelyn Trias 24/11/21.

From April of 2007, the stock market suffered a massive crash before staging a sustained recovery beginning in October of 2008:
(Source: Trias, J. (creator). (2021). (SPY) performance chart. Data Source:

According to, the investor in Scenario 1 who invests $100 per month starting in April of 2007 and who keeps investing $100 per month until today would end up with a portfolio worth $56,275.

In Scenario 2, the investor saves $1800 dollars from the start of the bear market until the low point and then starts to invest $100 per month from October 2008 until today. According to, they would end up with a portfolio worth $50,357 (including cash).

Lesson learned: the investor who got in right before the market crashed ends up earning ~11.8% ($5,918) more than the investor who waited until the "best" time to invest. Investing early paid off.

On the other hand, in Scenario 3, the investor who times the market perfectly and invests their $1,800 dollars of savings at the best possible time (plus $100 per month from October 2008 until today) would end up with a portfolio worth $57,286.

Lesson learned: even with flawless market timing, the investor who waits until the best day to invest only earns an extra ~1.8%. Once again, flawless timing barely pays off.

Sale now on

When the stock market falls, it feels like things are becoming ‘riskier.’ This is not the case, a market that falls in price increases in value. Wary investors run away from what history shows will be a great opportunity in hindsight. They wait for things to feel better before going back in, re-joining when the markets are going up instead of taking advantage of the declines - the definition of buying high.

The price of 1 unit of Vanguard FTSE Global All Cap Index Fund went from £182 on 1/1/2020 to £157 on 15/6/2020 – a saving of £25. On 4/11/2022 it is back at £170. In the short term you would have lost money buying in January, but made money buying in June – in the short term.

In the long term, historically the trend has always been up, so no matter whether you bought in January, June, or November, the price will most probably be higher in 10/20/30 years' time.

Leaving cash on the sidelines now, in a market that has dropped 20% from all-time highs, means that if things return to the previous all-time high in 2 years, that would be an 11.8% return per year from the current values.

Equity markets cannot be consistently forecasted, much less timed. The only way to be certain of capturing the full permanent returns is to remain invested during temporary declines. Successful investors act continuously and stick to the plan for the long term; failed investors react to current events.

If you are investing for the long term, now is a great opportunity to buy Equity – it is effectively ‘on sale’. Nobody knows if we have reached the bottom of the market, but even so, prices for Equity are lower than they were 10 months ago and they will very probably be higher in 10 years' time. Most definitely higher in 20 years' time!

Several studies have shown that “time in the market” is much more favorable than the idea of “timing the market.” In other words, waiting for the market to fall and predicting its rise isn’t the best strategy. Investing your money and giving it time to work is the best way to go.

If you are investing for your retirement in 20/30/40 years' time, you can afford to ride out the ups and downs in the stock market and have a high proportion of Equity, even 100%.

If you are looking to cash in your investments in the short term, say less than 10 years, you may wish to have a higher proportion of your fund in Bonds.

And if you can’t take the volatility, the ups and downs, and the swings in the stock market, then you can mix your portfolio with more stable Bonds.

Should I start investing now or wait?

Time in the market is better than timing the market.

Pay off any ‘bad’ debt, set up an emergency fund, and have some money set to one side in savings to pay for near term spending like a holiday, laptop, or Xmas presents!

Then with your allotted savings/investment money, decide whether you should be investing or saving (depending on the time period and objectives) within a Pension, LISA, or ISA.

Finally, AUTOMATE – set up your monthly affordable direct debit into your saving/investment plans, then switch off your computer and go enjoy life.

As a passive global low cost index investor, our belief or strategy is to ‘Buy and Hold’, and the great companies of the world over time, with reinvested interest and dividends, and Compound Interest will make us wealthy.

If you are fearful and couldn’t stomach a 30% fall in your Equity portfolio, then spread the risk, or volatility, using multi-asset funds. A sound asset allocation strategy ensures your investment portfolio is one you can hold without fear for the long term throughout market downturns.


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