Best to stay out of the markets: How many times from the tumult of the past year are you inclined or advised to this particular effect – a lot of complications, heightened risks, it’s all regulated so different, best to stop prior to the future outlook clears.
Without a doubt an oil price collapse of epic proportion and artificially low bank interest levels – within the U.S. kept at near-zero levels for many years at a time – have taken their toll. But to categorically avoid the stock markets and steer clear of investing is usually to disregard the late Sir John Templeton’s warning that the words “this time it’s different” are the most expensive, or dangerous, in the entire investment lexicon. Even Sir John would probably agree it is often a whole lot different since the near-collapse on the planet overall economy inside the years 2007-09 and also the dislocations of the oil-related “tsunami” that began hitting in late-2014. But, not so different that this timeless market cycle and it is ceaseless self-adjusting mechanisms wouldn’t once again bring inevitable economic and stock trading game recovery.
Sir John didn’t have any doubt relating to this while he reminded how bear markets are born at the height of euphoria, just like the tech-boom of 2000 – 01, and bull markets within the depths of despair, such as the spring of 2009 – and perhaps January – February 2016.
Too there were his steadfast adherence to “time in” rather than “timing” the markets being much the more important, but always – as outlined by a well-planned and executed investment strategy. Add his favourite word “fortitude” and his awesome famous Templeton Mountain Chart serves as a timeless reminder of the items an organised, long-term method of investing may bring.
While precise market timing can never the simple, waiting for a Godot mostly never appears can only be self-defeating. Truth be told it’s never altogether different. Instead, why not take Sir John at his word; invest as outlined by a strategically balanced plan. Wounded Canadian investors needs to keep this “fortified” knowing a fire-sale cheap Canada, its dollar and stock markets can seldom have offered such longer-term bargain investment attraction to match individual capital-appreciation or income needs, risk-reward tolerances and ultimate portfolio goals.
This is especially true for investors managing their very own portfolios. Obtain an advisor / researcher that will help you, setup your portfolio according to well-established and prudent criteria and think long-term. Don’t wait for “perfect time” to buy, it won’t exist. Or, as Si John was partial to saying: “The ideal time to speculate happens when there is a money”. Recognize that when the market is a its most tumultuous, you’ll feel anxious and wish to sell. Resist the desire, secure knowing that your portfolio will regain its value and a lot likely then some, once the market swings back – who’s always does.
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