It’s been months that people are speculating the shape of the financial recovery all around the world. Some believe that we are now on an uptrend and that the recovery is a V-shaped one while others are hoarding their cash and not willing to invest just yet because they feel that the market is going through a W-shape recovery.
So which of these V or W recoveries are you rooting for? As the market rallies as we speak and you’re not yet in the market, you’re probably hoping that the W-shape recovery comes true, huh? But if you’re convinced that it’s not a W-shape recovery and have missed the boat on being at the bottom of the market, would you step up now and dump your money in the market?
An interesting article came up today by i Capital on investor sentiments and the way they think the market will go. Read it here.
So where are you keeping your money these days if not in the market? FDs? Under your pillows?
{ 4 comments… read them below or add one }
Not sure bout other ppl but i never like to time the market. there’s no HIGH or LOW for me. Whatever that goes up will come down eventually and as long as I feel a stock is good and the price is affordable, i will try to buy it and just put it there for few months or even years.
Timing a market is equivalent to speculation, which is very risky.
Very conservative and wise investor
I’m a market timer but lousy at that.
I always get out a little early before the market peak (not burst), and I always get in a little late after the market bottom. Though I will keep around 20-30% fully invested most of the time to keep in touch with the market sentiments.
But you know what, it has been fruitful for me and saved me the headache of trying to break even on my portfolio if I had to suffer a 40-50% decline last year and trying to make up for it this year.
We cannot time the market but we must be aware that there is such a thing called the Boom/Bust Cycle because of human greed. Asset Allocation and Rebalancing is actually a form of market timing whereby you might shift more into CASH(yes, it is considered one of the asset class) if you think equities are over-valued and out of your precentage allocation. Alternatively, weightage on bonds could also be increased if you think there is value in bonds versus equities.
Me too, I’m bad at timing the market. I agree about those cycles you mentioned. And it is new to me that cash is considered an asset class on its own!