Quote:
Originally Posted by corn18
How will you know when to get back in? You have to be right twice.
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Yeah that's the million dollar question.
There's nothing wrong with taking a risk by going cash right now as long as one recognizes it for what it is - a risk.
Some people will get back in at the right time. Some people will fail to get back in and will have to buy in when the market is much more expensive. I've played this game before once and I lost. I made a bad bet. This way back in late 2011 when the S&P500 had a correction. I sold during the correction and failed to get back in until 3 years later because I was betting on another 2008-like crash that never happened. This bet was with about 15% of my total portfolio, but it still stings.
I'll continue with my buy and hold strategy that's given me a 10%+ compound annual growth rate over over the last 30+ years. It could've been 11% had I not tried to play guessing games with the market. I'm not that shrewd.
For anyone that cares, 90% of my money is in:
FCNKX (5%)
FSPSX (20%)
FSKAX (15%)
FXAIX (60%)
10% of my money is what I play with, and it has not done better than how a buy and hold strategy would have done. It's up 64% over the last 2 decades. The S&P500 is up 320%.