Hacker News Reader

What is especially hard in investing is timing. If you followed Matt's advice and put all your investments to index fund (say Vanguard Total Stock Market ETF, https://www.google.com/finance?q=NYSEARCA) in the late 2007, you would have lost almost 50% of your savings in a year. And this example is not far fetched. My startup got acquired in 2007 and I invested some of that money to the stock market in late 2007. Not all, fortunately.

View on HN

This is a terrible way of looking at things, since your time horizon is far too short. If you had put your money in the market at the height and kept it in until now, you would have made money. On Oct 5, 2007, VTSAX was trading at 37.72. It is currently trading at 51.87. Moreover, what was the alternative? Cash would have lost value due to inflation. Fixed income would have gotten you less and also been vulnerable to inflation.

>I invested some of that money to the stock market in late 2007. Not all, fortunately.

Why? The inflation adjusted CAGR of the S&P from Jan 1, 2007 to Jan 1, 2014 was almost 4%.

Reply on news.ycombinator.com