roadtrippin69
New member
Since the past year, there have been increasing talks about impending recession, and the biggest question that I ask myself is should I hold cash, or continue my SIPs!
I decided to run a little experiment today, and see how this decision has fared in the past. I know, that past performance is not an indicator of the future, but I just wanted to check how this has varied for my investment horizon in the recent past.
I took the NIFTY 50 data from Jan 01, 1999 to Jan 01, 2020. The basic assumption was that you get a fixed amount of money to invest every month on the first date of the month (Rs. 1000), and the minimum units that you can buy is 0.01. I tried two basic strategies:
Strategy
Final Holding
Max Cash Deployed
Max Cash Held Deploy Date
Buy ASAP
11,33,700.11
1,108.96
2018-09-03
Buy on or below (5%)
11,27,949.68
13,054.54
2018-02-06
Buy on or below (10%)
11,32,815.26
20,025.82
2015-05-07
Buy on or below (15%)
10,95,813.36
24,047.62
2015-09-07
Buy on or below (20%)
10,80,350.19
43,004.86
2016-02-11
Buy on or below (25%)
10,65,730.86
24,013.73
2006-06-08
Buy on or below (50%)
9,52,183.34
85002.78
2008-10-17
Here is the code (if you'd like to fiddle). I am new to python, so it is absolutely possible that I messed up in the code somewhere. If you find any issues, let me know, and I'd be willing to run the experiment again.
Edit:
I'm thinking of writing a blog entry with detailed graphs and other strategies. Would that be something that you guys might be interested in?
I decided to run a little experiment today, and see how this decision has fared in the past. I know, that past performance is not an indicator of the future, but I just wanted to check how this has varied for my investment horizon in the recent past.
I took the NIFTY 50 data from Jan 01, 1999 to Jan 01, 2020. The basic assumption was that you get a fixed amount of money to invest every month on the first date of the month (Rs. 1000), and the minimum units that you can buy is 0.01. I tried two basic strategies:
- You invest as soon as you have cash.
- You invest only when the index is at least x% from the all-time high.
Strategy
Final Holding
Max Cash Deployed
Max Cash Held Deploy Date
Buy ASAP
11,33,700.11
1,108.96
2018-09-03
Buy on or below (5%)
11,27,949.68
13,054.54
2018-02-06
Buy on or below (10%)
11,32,815.26
20,025.82
2015-05-07
Buy on or below (15%)
10,95,813.36
24,047.62
2015-09-07
Buy on or below (20%)
10,80,350.19
43,004.86
2016-02-11
Buy on or below (25%)
10,65,730.86
24,013.73
2006-06-08
Buy on or below (50%)
9,52,183.34
85002.78
2008-10-17
Here is the code (if you'd like to fiddle). I am new to python, so it is absolutely possible that I messed up in the code somewhere. If you find any issues, let me know, and I'd be willing to run the experiment again.
Edit:
I'm thinking of writing a blog entry with detailed graphs and other strategies. Would that be something that you guys might be interested in?