When is the best time to buy ETFs?
The uncomfortable but data-driven answer: the best time is almost always NOW. “Time in the market beats timing the market” — those who invest early and consistently almost always beat those who wait for the perfect entry. A savings plan solves the question all by itself.
The short answer
The “best time” in the sense of the absolute bottom cannot be reliably predicted — by anyone. The historically best strategy is therefore not waiting for the perfect moment, but starting as early as possible and then staying invested. The longer your money is invested, the stronger the effect of compound interest. The most expensive day is usually the one on which you never get started at all.
Why “time in the market” beats “market timing”
The biggest price gains often occur on a few, unpredictable days — and these almost always come right after crashes, when most investors are standing on the sidelines. Those who wait out of fear miss exactly these days. Analyses spanning decades show: anyone who misses the 10 best stock-market days roughly halves their long-term return. That is why being invested beats waiting.
The all-time-high paradox
Many hesitate because the market is “already so high”. But historically, stock indices spend a large part of the time near their all-time high — new record levels are the normal state of a market that rises over the long run, not a warning signal. Studies even show: those who invested precisely at an all-time high achieved, over the following years, similar or better returns on average than at a random day.
What waiting really costs
€10,000 invested vs. waiting one year (example calculation, 7 % p.a.)
| Strategy | After 30 years | Difference |
|---|---|---|
| Invested immediately | ≈ €76,100 | — |
| Waited 1 year | ≈ €71,100 | −€5,000 |
| Waited 5 years | ≈ €54,300 | −€21,800 |
The figures are illustrative and assume a constant return — the market naturally fluctuates. But the principle holds: lost years in the market are hard to make up, because compound interest has its strongest effect at the very end.
The elegant solution: a savings plan
If the timing question paralyses you, an ETF savings plan takes the decision off your hands: you automatically invest a fixed amount every month — sometimes at higher, sometimes at lower prices. Over time this produces an average price (cost-average effect) and you never have to hit the “right day”. For most private investors this is the psychologically and practically best route.
Money you will need in the next 3–5 years (emergency fund, a planned house purchase) does not belong in an equity ETF — no matter how good the timing seems. The time horizon is more important than the entry day. First build the emergency fund, then invest.
When waiting really is the right call
There are clear cases in which you should not invest — regardless of the market:
- You have no emergency fund (3–6 months of expenses in an instant-access account) — build that first.
- You need the money within 3–5 years (buying a house, a car) — then an equity ETF is the wrong vehicle.
- You have expensive debt (overdraft, consumer loan) — paying it off delivers more “return” than any ETF.
- You would panic-sell at −30 % — then first clarify your own risk tolerance.
FAQ — Best time for ETFs
Should I wait for a crash before I invest?
Usually no. No one knows when the crash will come — perhaps only after the market has risen another 40 %. Those who wait often miss out on more return than the hoped-for crash discount ever brings in. Time in the market beats waiting.
Is it bad to buy at an all-time high?
No. All-time highs are the normal state in a market that rises over the long run. Historically, returns after entering at an all-time high were, on average, no worse than on any other given day.
Lump sum immediately, or spread it out?
Historically, the lump-sum investment was better in roughly two thirds of cases, because the market mostly rises. Those who cannot psychologically bear the volatility can invest the amount staggered over a few months — on average this costs a little return, but it protects against the bad-timing feeling.
Is there a best month seasonally?
Seasonal patterns (“Sell in May”, etc.) are statistically weak and not reliably tradable. Waiting for such rules usually costs more than it brings. The best month is the one in which you get started.
What if I invest and the crash comes immediately?
With a long horizon that’s bearable: if you hold on, a global ETF has recovered after every crash. Anyone wanting to reduce the risk enters in stages over several months instead of all at once.
Does this also apply in a recession?
The stock market usually runs ahead of the economy and can rise while the recession is still under way. Waiting for ‘better times’ often means missing the recovery. More important than the economic cycle is your personal horizon.