Should You Buy Index Funds Now, in an Overvalued Market?

As a passive investor, is it wise to buy market tracking index funds and ETFs from companies like Blackrock, Vanguard and State Street, even when they're at all time highs? Jack Bogle (founder of the Vanguard group) spent most of his career working in the passive investing field and in this video, we break down his thoughts as to dollar cost averaging in an overvalued market.

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★ ★ CONTENTS ★ ★
0:00 Speculation Driving the Stock Market
2:40 The 2 Possible Outcomes
4:20 Should You Buy Index Funds Now?
8:34 Jack Bogle's Advice
10:00 Buy Right, Hold Tight

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[NewMoneyYouTube]

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[lukefisherDD]

As an investing enthusiast, I often wonder how top level investors are able to become millionaires off investing. . I’ve been sitting on over $545K equity from a home sale and I’m not sure where to go from here, is it a good time to buy into stocks or do I wait for another opportunity?.

[NatalieFormor]

I did lots of backtesting and found that 20% SCHD/DGRO, 20% VGT/QQQ/SCHG 20% VOO and 40% bonds or 4%+ money market matches the growth of SP500 in up years but reduces the losses in down years by 40-60%. I'm still looking for companies to make additions to my $350K portfolio, to boost performance. Here for ideas...

[nickl]

The amount of scammers in the comments is

[jerrycampbell-utyf]

I feel investors should be focusing on under-the-radar stocks, and considering the current rollercoaster nature of the stock market, Because 35% of my $270k portfolio comprises of plummeting stocks which were once revered and i don't know where to go here out of devastation.

[AndersonFair-cybb]

The market's direction can swiftly change, with indexes frequently transitioning from a bear market to a bull market precisely when the news is most negative and investor sentiment reaches its lowest point.

[JenniferDavis]

Putting well-earned money into the stock market can't be over emphasised for first-time investors, unlike a bank where interest is sure thing! Well, basically times are uncertain, the market is out of control, and banks are gradually failing. I am working on a ballpark estimate of $5M for retirement, and I have a good 6-figure loaded up for this, could there be any opportunity for a boomer like me?

[phyllisburtonhearsawho]

Transfer of wealth usually occur during market crash, so the more stocks drop, the more I buy, in the meanwhile I'm just focused on making better investments and earning more as recession fear increases, apparently there are strategies to 3x gains in this present market cos I read of someone that pulled a profit of $350k within 6months, and it would really help if you could make a video covering these strategies.

[CameronFussner]

AI stocks will dominate 2024. Why I prefer NVIDIA is that they are better placed to maintain long term growth potential, and provide a platform for other AI companies. I know someone who has made more than 200% from NVIDIA. I'll also take any other recommendations you make.

[Madridstrat]

I've kept much of my savings in cash for safety, but I'm unsure if it's right for retirement. Contemplating investing $100K in stocks, as I've heard investors can profit in tough times. Unsure about my next move.

[j-ron]

I think about it this way: if everyone is waiting for a pullback to eventually buy more, then the price might not be that unreasonable

[NathanSamuel-chfl]

I want to start investing but need guidance. Any advice or recommendations for assistance?

[soylentgreenb]

The answer for me when I know the hype isn’t real is to find a less overvalued index (e.g. S&P 500 equal weight or msci world enhanced value or msci world quality sector neutral) these are nice indices to begin with since they’ve had good performance and don’t go so heavy on the bubbly stuff.

[PaytonBilliAndria]

My primary concern is how to grow my reserve of $300k which has been sitting duck since forever with zero to no gains, sure I know the risks of short term gains are much greater but if well managed one'd make a killing, am I wrong?

[PeterParker-wjcr]

Jack Bogle is one of the most venerated investors of all time! The impact of index fund investing has been immeasurable. Buy and hold forever might not apply as well to individual stocks. But you definitely want to hold onto the greatest companies in America forever! He is a luminary legend!

[TuoDev]

Great advice and details from both history and now. Subscribed.

[MC-gjfg]

I agree with DCA the same amount in bull or sideways markets, especially given that cash is paying so much right now, but wouldn't there be a strong argument for DCA a higher amount during market lows? We're not trying to foolishly time the bottom of the market, but if the market drops to a spot where we can objectively call it "on sale" it seems like a good time to dump more in than normal.

[CAGriff]

Yes - but I’m not buying a lot: it’s averaging and sometimes when my main position is at an inflated price, meaning right now, I have lowered the amount i put into it bc mag-stocks are carrying indexes and honestly finding good depreciated good stocks underneath the index tech growth.

[augustindroste]

Hi Brandon,

I wonder how you explain your passion for stock picking, which fundamentally contrasts with passive investing, as you aim to outperform the market. Passive investing, on the other hand, involves averaging the market's returns and aligning your portfolio accordingly. I find myself at a similar crossroads and would love to understand your rationale behind choosing both approaches, which seems paradoxical to me.

Thanks and keep up the thoughtful content!

[michaelchoi]

Man, Jack Bogle had a killer speaking voice.