wayneL said:
Yes indeed!
Meanwhile :hide:
(Just had to have an excuse to use that emoticon
)
Well Wayne, I fully agree we are in for a large correction if not crash, I know it, you know it, almost everyone agrees.
But no-one knows when.
The great man himself, Ben Graham acknowledged this very problem.
What do you do when the market is overvalued?
Do you pull out and wait until it crashes?
NO!!!
Because you may be right the market is overvalued, but it can remain overvalued for years and still increase.
If you pull out and wait one year but it increases more, two years it increases even more, three years and it goes up again. Maybe 4 or 5 or 6 years. It is overvalued but still increases.
What are you going to do? Human instinct is to admit you were wrong and you jump back in. Guess what you were right and it crashes - not only did you miss out on the gains but you caught the huge losses.
The market will correct itself, but no-one knows when, the safest thing to do is to always stay in the market, and always be incredibly careful. Always have money in the bank, and always think about undervalued stocks that pay dividends. There is no way of timing the market despite all the rumours and stories you hear. It is NOT about timing the market, it is about time in the market. The longer you are in the more chance your increases outweigh any crashes.
You are totally correct a crash/correction will happen. But neither of us know when. The smartest thing to do is to proceed cautiously.
Pulling out and watching will only cost you money.