When buying the dip doesn’t work: An analysis of the dot-com crash

Re:When buying the dip doesn’t work: An analysis of the dot-... by temp_praneshp on Sunday May 08, 2022 @12:09PM (#31305321)

Out of curiosity: How do you test your sheets? I feel like I can arrive at such a sheet over a few days of reading, but unsure how I'd test I'm doing the right things (since there isn't a tool or a combination of tools that can act as oracle)

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Re:When buying the dip doesn’t work: An analysis of the dot-... by maire on Sunday May 08, 2022 @12:25PM (#31305495)

I used ETFs (and not stocks) to simplify the test. I was mostly looking for correlations of different investments across different scenarios. I then looked at severe market downturns to see how the correlations changed.

As you can imagine - when there is a severe market drop, most investments are highly correlated to the S&P. The most negative correlation I could get was medium term bond ETFs. Short term bonds were still highly correlated and I am not sure why.

The dot com bust was particularly interesting because each segment dropped at different times. Telecom dropped first, then tech. It took about a year for the drop to hit mid cap. In comparison - the 2008 crash hit everything quickly.

Also - lately I have been using the backtesting tools in TOS. As I said earlier, this only works for stocks and not ETFs.

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Re:When buying the dip doesn’t work: An analysis of the dot-... by temp_praneshp on Sunday May 08, 2022 @12:31PM (#31305541)

gotcha, thanks for answering!

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Re:When buying the dip doesn’t work: An analysis of the dot-... by maire on Sunday May 08, 2022 @12:56PM (#31305769)

If you are using google sheets you can use ycharts to pull in the dividend data. Here is my calculation to get 1 year of dividends.

=query(importhtml(concatenate("https://ycharts.com/companies/",$A4,"/dividend"),"table",0),...)

where $J$2 is ="select Col6 where Col1 > date '"&TEXT(I2,"yyyy-mm-dd")&"' LIMIT 12"

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