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Should you Buy and Hold?
Based on our cyclical projections, the market will suffer a major wipeout within the next five years. Will you be ready?
Buy and Hold is an investment style which is very much in vogue in the mainstream media. From television programs like Bloomberg and CNBC to wide circulation magazines like Kiplinger’s and Money, you will likely hear the same refrain:
Don’t try timing the market, it is impossible. Buy good stocks and hold them through thick and thin.
Several generations of academic writers beat the same drum. Espousing the Efficient Market Hypothesis, the majority of academic analysts will tell you that the market takes into account all available information, and that it makes no sense to try to buy when valuations are high, and sell when valuations are low, or make a trading decision on the basis of price patterns or trend. If any of those systems actually worked - these pundits will tell you - the market, in its infinite wisdom, would incorporate them and eliminate their effectiveness.
In a nutshell: Don’t try timing the market, it is impossible. Buy good stocks and hold them through thick and thin.
There is only one problem with all of this:
It's wrong!
Intelligent people can be wrong
It’s not the first time in history that a majority of very smart people wound up coming to the wrong conclusion.
There was an entire generation of brilliant Greek scientists who argued successfully that the Earth was the center of the Universe. These were not baseless claims. In fact they made very precise measurements looking for a stellar parallax. If it existed, they argued it would prove the earth rotated around the sun.
They didn’t find it.
So they concluded the sun, stars and planets all rotated around the Earth.
Does that mean the earth is at the center of the Universe?
Of course not.
We now know not only that the Earth rotates around the Sun but the Sun is just one star in Milky Way, which itself is just one Galaxy in the Universe.
So the brilliant Greek scientists weren’t just wrong. They were WAY wrong.
Lesson learned: You can be wrong no matter how smart you are and how many people agree with you.
Though the Ivory Tower professors and Wall Street touts will staunchly disagree, the fact is market timing can and does work.
How market timing helps your investment results
About 70 percent of an typical stock's price action can be predicted by the price action of the overall market. Please think about this for a moment. Say the Nasdaq is down today. Any stock chosen at random has a 70 percent chance of being down as well. Imagine trying to pick an entire portfolio of stocks which do exactly the opposite of what the market is doing.
Think back to either of the market crashes of the last ten years. Were you invested in stocks? Did your portfolio magically rise as the Nasdaq crashed? Not likely. And it's not your fault. In a market swoon, most stocks will be dragged down along with the averages.
Effective market timing can and will keep you on the right side of the market most of the time. This means that you will own stocks when the market is going up and will be out of the market (or short) when the market is headed down. We have advanced strategies which can take full advantage of flat markets as well. This means that no matter what the market is doing, we’ve got you covered!
With Investment Sense on your side you can rest at night knowing your investments are safe. Our proprietary system takes into account over 50 individual factors to ensure you stay on the right side of the market.
Take the two month Free Trial and see what our award winning timing can do for your investment results.
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