Should we be attempting to time the market?
If you can do it consistently and reliably one would assume the answer would be a resounding, Yes. However, there are only a few people in the world that can consistently time entry into and exit out of the markets in volatile times, and I don’t profess to be one of them.
If you can’t achieve any reasonable certainty, another option would be to take your best guess … obviously this is not investing but speculating or gambling. Personally, I’d prefer not to take guesses with hard earned money that is not mine so instead I’d rather rely on sound fundamentals and spend more time in the markets than attempt to time when to get in.
Fundamentally, if your portfolio remains well diversified with exposure to a wide range of asset classes, investment managers and investment styles things should turn out OK. If you feel your portfolio is not well diversified, perhaps we need to talk further.
Fundamentals reinforce that there will be good times and there will be not so good times, the thing we need to do now is hold on and ride the wave.
Let me share with you a presentation by Michelle Heinrich from MLC’s Investment Communications Team. The presentation titled Impact of Market Timing takes about 8 minutes and should provide some reassurance to most who have been affected by the markets recent volatility.