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If you can lose 20% and still make the balloon payment then only risk the 20%. Based on your question you can set aside 1,200 a month for the next 15 months. Since 20% of 15 months is 3 months take the next three months payments and invest it in a ETF or mutual fund. The remaining 12 months keep it safe in a bank or CD. You can do this because you already ...


2

For Short term stocks are very dangerous and there is a possibility to have your returns in negative. For Short term only bank CDs are safer investment, as there is no chance of losing money. Why do you delay the payment of your Car loan ? Pay the debt as early as possible. Being debt-free is one of the best feelings of human life. UPDATE Car loan ...


4

Common advice given is that if you decide to become an active or passive investor, you should stick with the choice you've made. That you're less likely to be successful if you try to pursue both active and passive investing strategies. Do you have a source for this? That advice is so very wrong. It suggests, that once you make a choice you can never ever ...


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Common advice given is that if you decide to become an active or passive investor, you should stick with the choice you've made. No you shouldn't. It is perfectly fine to supplement an active portfolio by passive index funds, or to supplement an index fund portfolio with several carefully chosen stocks. What is bad advice is to buy lots of various active ...


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I strongly advise you to reconsider whether this is the right time for you to take on additional debt, even for a worthwhile purpose to earn rental income. It is highly unlikely that you can achieve higher returns, or lower risk returns, compared to just paying off your credit card and auto loans. If you pay those off even by consolidating at a 4.5% loan, ...


1

I'm going to answer based on my own personal perspective on financial decisions - ultimately, you need to determine your own criteria (risk tolerance, goals, etc) and decide the answers to your questions for yourself. Personally, I don't think it makes much sense to invest money when you have outstanding high interest debt, because from a pure numbers ...


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I created a simulation to test the performance of cash, crab, and "falling knife" strategies in a variety of random market conditions. What I found is that in a rising market, the "crab" strategy outperforms both "falling knife" and "cash". In a roughly flat market, all three strategies are roughly the same performance. In a falling market, "cash" ...


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Interesting idea. Dont catch the falling knife strategy sounds like you're buying while the stocks are appreciating (e.g. they are trending up) - which seems like the opposite to the Warren Buffet advice: Be fearful when everyone else is greedy. Be greedy when everyone is fearful I think Crab investing is the way to go, dollar cost averaging spreads ...


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You're right, there's not a strong line between "short-term" and "long-term" other than for taxes, where 1-year distinguishes between short-term and long-term capital gains. What you really want to know is "what are the chances that I'll lose more than 5% in 3 years if I invest in X", which is not a simple answer. If you want to use history as a guide, ...


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Since you are asking a lot of questions at once, this answer is a non-exhaustive list of options to consider: Setup an emergency fund first. A usual recommendation runs at 3-9 x your monthly salary. Due to the german social safety net, this multipler can be lower, but as you are a foreign national(?), you might rather err on the higher side. Deal with any ...


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