Fuzzy Roth IRA MAth
I've had a long weekend road trip, so I'm sure my math and thinking are completely off, but what am I missing in this hypothetical scenario:
1. I invest $50k into the S&P 500 (SPYM, VOO, doesn't matter). Over 1 year it goes up 20%. I now have a value of $60k.
2. I get scared because of market conditions and I sell my ETF, holding the cash in my brokerage account for a few months.
3. The market recovers and I decide to buy back in with my $60k at a higher price point than when I invested the original $50k.
4. The market does really well, hitting another +20% over the next year. My $60k is now worth $72k.
Does the fact that I am moving in & out of the same ETF position really matter inside a Roth IRA? The number of shares don't really play into anything, it's the gain percentage that I am looking at. I know I am missing something, hence the fuzzy math.