It would be nice to feel good about your financial plan, wouldn’t it?
Professional money managers point out that the stock market goes up over time, and with the power of compounding, you will make the most money getting in and staying in the market.
If you need, or want that money, it is pure luck if your timing is off. If the market is in a multiyear decline when your money is wanted or required, you may be selling low after buying high.
Yet, if you play it safe and stay in cash all the time, your wealth does not grow.
What is a person to do?
After being burned by financial professionals who really do no better than just any old index fund, I am only comfortable with a personally managed, active strategy.
I have no idea what tomorrow will bring. But, so what?
Follow the crowd in the market and stay with the trend. If you are moving in the same direction of the market, and keep plenty of cash in reserve for opportunities and a hedge, you can grow your wealth and not fear what tomorrow may bring.
Once again the market is at a key level. If the market marches higher, join in the rally and buy stocks or ETFs that are moving with that trend.
Here is a frustrating truth. The market never makes sense or does what you think it should. Get over it.
If the market rolls over, raise cash and get off the slope of hope.
It is a simple plan that works. Alternatively, you can give your money to a professional to run for you.
This guy comes highly recommended.