You should have a view of the stockmarket if you are thinking of making AVCs

jim

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So basically your question is - should I make an AVC or not?

This is akin to asking - will stock markets rise or not.

Putting 6k avc into yiur pension which presumably is invested in stock market is a punt imo.
 

jim

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But if you envisage a downturn in market for whatever reason then you should not put more money in stock market. If you envisage stocks to rise for whatever reason, lash it in.
 

Brendan Burgess

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But if you envisage a downturn in market for whatever reason then you should not put more money in stock market. If you envisage stocks to rise for whatever reason, lash it in.

Neither he, nor you nor anyone else knows what will happen to house prices or the stock market in the short to medium term.

Therefore his strategy should not be based on this.

Brendan
 

jim

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Neither he, nor you nor anyone else knows what will happen to house prices or the stock market in the short to medium term.

Therefore his strategy should not be based on this.

Brendan
Everyone is entitled to an opinion and everyone is entitled to base that opinion on something.

Whilst of course nobody can predict the future, successful investors surely base their stock market investment decision on something (research). They dont blindly continously invest beceause they cant make an informed decision (or to put it your way - cant predict future). Its not about blind prediction, its about making informed decisions based on research.

Anyone can do some amount of research on which to base their investment decision. This is what I am suggesting to the OP.

My advice is if you envisage the market to do well over your own investment horizon, based on whatever level of market reasearch you deem fit, then lash it in, as long as all other factors in your financial affairs allow for it.

On the other hand, if your research suggests a possible market downturn - consider holding off on putting your hard earned money into the market.
 

RedOnion

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Whilst of course nobody can predict the future, successful investors surely base their stock market investment decision on something (research). They dont blindly continously invest beceause they cant make an informed decision (or to put it your way - cant predict future). Its not about blind prediction, its about making informed decisions based on research
It's interesting to read this post together with one you made on 30th March last year when you were saying the same thing:

The OP has a 25 year + investment horizon. There'll be ups & downs during that time, but if he knew better than the market he'd be making so much money he wouldn't be worried about AVCs.
 
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jim

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It's interesting to read this post together with one you made on 30th March last year when you were saying the same thing:

The OP has a 25 year + investment horizon. There'll be ups & downs during that time, but I doubt he knew better than the market he'd be making so much money he wouldn't be worried about AVCs.
Not sure I fully understand your point Redonion.

Im just saying that, whilst of course nobody can predict future, they shoukd however research and make an informed decision and based off of that if they envisage market to remain strong etc, invest and if they dont then dont invest. Its that simple. The OP has other considerations though wrt whether or not they should make an avc but, all else been equal, if the OP does some research and thinks that the market is going to decrease for whatever reason then i think they should not invest their avc until such time as their personal outlook improves
 

PGF2016

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But if you envisage a downturn in market for whatever reason then you should not put more money in stock market. If you envisage stocks to rise for whatever reason, lash it in.
If you can predict the stock market you should stop working, trade the markets and become a millionaire.

In reality this is not possible and OP should not take this advice when the money is required in such a short time span (for trading up in 3/4 years).
 

Gordon Gekko

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Everyone is entitled to an opinion and everyone is entitled to base that opinion on something

No they’re not. It’s one of the great fallacies of the modern era. Every eejit with a keyboard or a smartphone thinks that his or her opinion is of equal value to everyone else’s. It’s not. It’s part of the whole issue around “the public having enough of experts” and social media/the internet platforming every eejit on the planet.

If you’re a CFA working in Ned Davis Investment Research, and I’m some barstool bore, our opinions on markets are not of equal value and I’m not “entitled to my opinion”. Even the phrase “I’m entitled to my opinion” has become a kind of “dropping of the mike” when in fact it means “you’ve got me, I haven’t a rats what I’m talking about”.

Those eejits marching in town and claiming that Covid is caused by 5G, engineered by reptile people disguised as politicians, and all funded by George Soros...are they “entitled to their opinion”?

The right to an opinion needs to be earned.
 
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jim

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Everyone IS entitled to an opinion and they ARE entitled to base that opinion on whatever they like.

Im not saying necessarilly that that opinion can rightfully be broadcast or shared. Its someones personal view on something! Its irrelevant whether its an opinion you agree with.

It is possible to form an opinion on how you see the markets going. That opinion may prove to be correct or incorrect. It doesnt mean you are claiming to predict the future. Its simply making an informed investment decision for yourself.

It is possible to carry out research and make a decision based on that research.

The level of research may be extensive or it may not.

If i extensively research the market and make my investment decision based on that then i am making an informed decision, nothing else. The decison may pay off or it may not.

So if i have 10k to invest in tbe markets then i will do some research until i satisfy myself as to whether i think the markets will go up or down. Thats all i am saying and thats all i am suggesting the OP does (notwithstanding they may have alternative use cases for their money).

Dont confuse making a call based on some research with predicting the future.
 

Sarenco

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So if i have 10k to invest in tbe markets then i will do some research until i satisfy myself as to whether i think the markets will go up or down
You are really just trying to time the market - which is a terrible strategy.

"Far more money has been lost by investors preparing for corrections, or trying to anticipate corrections, than has been lost in corrections themselves" - Peter Lynch.

Time in the market beats timing the market.
 

SPC100

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The research says if you have a lump sum the best expected future value is to lash it in as soon as possible.

If from a behavioral/psychological point of view that is hard to do, the next best is to split it into installments and lash them in every day/week/month/year without fail. Pick one and do it regardless of price.

If you select this (dollar cost averaging) route and have the fortitude, if when you make the next installment the market is lower you should put more in then, as effectively you have been lucky and should take advantage of the timing.

Deferring investing any of the money has a lower expected future value on that money. You have to make two correct calls to win. Decide to defer and invest when market is lower (and you need to factor in lost dividends). This can happen but it is less likely.

Your opinion should be based on research in my view, and the research is clear.

Every time you have excess that you don't need for 5 or 10 years, lash it in. This is the best strategy for lifetime investment.
 
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ArthurMcB

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Ok fair points all round and certainly does change my perapective. Im a gambler by nature which also a mugs game!! Thanks.
 

Gordon Gekko

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Well when it comes to investing, if you have earned €1,000 and have it available to invest then you have earned the right to your opinion, at least as far as that €1,000 goes.
Why

My opinion on how a pipe might need to be fixed or what type of mix to put in a tooth filling or what type of isolator switch to use for a combi-oven is almost completely worthless.

Every eejit seems to think they’ve a right to an opinion about everything and that their opinion is as valid as anyone else’s.

They don’t and it’s not.

This is a conflation of social media giving every eejit a soapbox and an X Factor generation thinking that they’re smart and can sing like Tom Jones ‘cause their granny told them so.

The right to an opinion is earned.
 

cremeegg

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Wow, we are grouchy this morning.

If I say I can sing like Tom Jones, I can sing like Tom Jones, :D:D:D. You don't have to listen.

(You don't know what you are missing.)
 

Itchy

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'Don't tell me what you think, tell me what you have in your portfolio.' - NNT
 

NotMyRealName

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My opinion on how a pipe might need to be fixed or what type of mix to put in a tooth filling or what type of isolator switch to use for a combi-oven is almost completely worthless.
I notice you said almost , so you're not quite ready to admit that your opinion has an absolute worthlessness when you're in unfamiliar territory.

Expert echo chambers are dangerous places. Even the uninitiated should never feel like they have to question any form of perceived wisdom with the deferential......" I have a stupid question.."
For this reason, ALL opinions should be heard. I ,for one , try to read a lot more comments than I'd write.
We won't learn or consider any possibilities if our attitude is..."when I need your opinion, I'll give it to you."
 

Gordon Gekko

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I notice you said almost , so you're not quite ready to admit that your opinion has an absolute worthlessness when you're in unfamiliar territory.

Expert echo chambers are dangerous places. Even the uninitiated should never feel like they have to question any form of perceived wisdom with the deferential......" I have a stupid question.."
For this reason, ALL opinions should be heard. I ,for one , try to read a lot more comments than I'd write.
We won't learn or consider any possibilities if our attitude is..."when I need your opinion, I'll give it to you."
Sometimes the smart opinion can be “let’s listen to the expert”
 

NotMyRealName

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Indeed......it's said that Albert Einstein was once asked if he kept a notebook to hand to record all his good ideas.....his response was that it wasn't necessary....as he had so few of them. Now that's humility.
 

MrEarl

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There's a lot more to consider than just taking a view on the current position of the stock market - and let's not forget, you can make AVCs, and then invest in other asset classes.

Amongst other things, you might also want to form a view on whether the tax rules are likely to change, with regards to tax relief on contributions going into pensions, or if growth will continue to be tax free, within pension funds.
 
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