Lately I’ve been seeing articles warning investors that a bear market is coming soon.
I, for one, can tell you that there will definitely be another bear market, but I have no idea when.
Many of these articles imply that a bear market is around the corner and you should prepare. Some of these writers are suggesting that you take some profits from your winners and rotate into more defensive stocks.
There’s one problem with that, though. What happens if you do that and then the market goes up another 20%? What if you rotate out of a stock that goes up another 25% without you on board?
It is impossible to try and time the market. Most people that try, fail.
If you need your money within the next two to three years, then you might consider taking your money out of the market, whether we have a bear market or not. However, if you have a much longer time frame – like 10, 15 or 20 years, or more – my recommendation is to just sit tight and let the market do what it’s going to do.
If, by chance, a bear market hits next month…or next year…remember this quote from the great Shelby Davis:
“You get rich in bear markets.”
Until next time!