03-03-2014, 10:22 AM
I think it is a mistake, though an understandable one, to assume that because the market is at all-time highs you must be more cautious that usual or to think there is a higher than average probability of a major downturn. So long as the market's general trajectory is upwards, which has been the case for over 100 years, there have been countless times that investing at the all-time high was prudent. There will always be swings, some major and some minor, and those can be great opportunities to deploy cash. But the mere fact that we are at all time highs shouldn't deter you from pursuing available opportunities and from sticking to your long-term allocations.
If this high felt like a bubble and if P/Es were sky high, I might be singing a different tune. But valuations seems reasonable enough to me right now that I'm not going to reduce my holdings or sit on the sidelines. Of course I would certainly welcome another big correction -- I'd love to pick up more stocks on sale!
If this high felt like a bubble and if P/Es were sky high, I might be singing a different tune. But valuations seems reasonable enough to me right now that I'm not going to reduce my holdings or sit on the sidelines. Of course I would certainly welcome another big correction -- I'd love to pick up more stocks on sale!