We are currently enjoying the second longest bull market in history. The chart below gives us a great historical perspective as to how all the secular bull markets since World War II have looked. How long will this bull market last? No one truly knows. It might outlast the mighty 1990’s bull… or end tomorrow. Our philosophy believes in taking what the markets give us and avoid worrying about what might or might not happen. Investments decisions based on worry or other emotions rarely turn out well. If you invest with a rules-based process designed to make the buy and sell decisions for you, then you can remove your emotions from the investment decision making process.
If you are an investor with cash, and you regret missing out on this bull, then don’t continue with your fear of missing out. Break up your buy decision into 5 (or more) smaller decisions or 20% “buckets”. Invest 20% a month for the next 5 months knowing you can stop, continue, or even sell if necessary. Put the first 20% into a rules -based growth strategy designed to make both the buy and the sell decisions for you. After this, stick to your investment plan. Do it now because the chances of you achieving your financial goals by investing in cash are slim!
If you are an investor who has participated in the bull but worry that the “end is near” and that a correction or worse is imminent, breathe! Look at your portfolio and rebalance back to your original plan’s allocation. Trim over-weights. Also, consider a rules-based growth strategy for a portion of your portfolio to help with the buy and sell decisions going forward. Enjoy the gains, keep on investing, but position your portfolio to weather the next investment storm without having to panic.
Everyone wants to grow their money. No one wants to lose their money. None of us know the future, and none of us can perfectly time the market, but all of us can act prudently now.
Disclosure: This material is for informational purposes only and should not be construed as financial or investment advice
