well, it looks like most responses here really have no idea,
yes, you cannot time the market; but when the entire world economy is slowing; why you are risking your financial market invested assets; I do not know.
yes, do keep putting money away every paycheck, month or however you add regularly but if you have a substantial amount, like over even 50k; limiting mkt exposure when macro economis say the economy is slowing or enterting a recession; I do not understand; you should be separating them into mostly cash.money markets/bonds with little stock/equity exposure.
so, you sit out this year until you see reports that wages are increasing, retail sales are increasing and mortage loan defaults are increasing and housing prices are rising and you lost ? mybe 10% of the bottom, it beats the ride down imo.
please think about it as time lost for capital appreciation. if you got out at 10% down and the avg recession is 28% down; you will have over 15% more on the ride back up than you would hade lost if you had taken the ride down that most everyone else does and you will have to take the additional time to get back to even.
a fact:
95% of the time, mkts are recovering from previous loses and only spend 5% making new highs.
how much do you wish to give bacj to wait and recover ? my post is coming up shortly to give advice on where we are in the mkt.
I believe the soft version of the efficient market hypothesis. Which is the one that has actually been tested, i.e. markets immediately reflect new information, i.e. market price is the sum of known knowledge.
So at the moment, there is some risk of a slowdown, you're not the only one who thinks that. Prices have already dropped because of that. Some people think it could be a severe slowdown - that's already in there. So is that some people think the economy will grow or even boom.
So who knows, maybe the market is reflecting a probability of 10% severe slowdown, 20% slowdown, 60% stable, 10% boom.
You can only "beat the market" if you're understanding, is better than it. So are you so sure, you're understanding of the probability of a slowdown is so much better than what the market's is.
I would have been more impressed, if about 6 months ago, you posted - markets are going to fall - sell. That would have been a clear case of realizing the market was incorrect, and taking advantage of that. Especially, in retrospect you would have been proved correct.
In summary, I am much more interested in hearing people who are contrary to the general market sense. If they make a good argument, I'll remember them, and if it turns out, I'll pay them more attention in future.
But people who after the market has boomed, say its a good time to buy, or after its crashed, say its a good time to sell. I don't really pay much attention to. By the time they say such things, its too late, and on historical evidence, following what they say, is usually the OPPOSITE of the best cause of action.
