Originally Posted by
Fredturbo
and a day like today is a reason why very, very few can outperform the market by timing it based on gut feeling. Neighbor pilot was convinced in Mid March that the S&P would hit 1,100 and went to all cash. It’s now 3,300. He’s now borderline suicidal as he’s said he could nearly retire if he just kept to his long term buy, hold, and readjust thesis ala Warren Buffett who he is a huge fan of. He said it just didn’t make sense and panicked. “IF” the market drops 10-15% and your time horizon is at least 10 years, then be glad you can buy more at lower levels. If you go all cash now and the market slowly moves up over the next few years never dropping more than a couple percent, then what? Get back in based on gut feeling. That’s a way to lose.
I have never understood the idea of someone, who is 20+ years from retirement, wanting their 401k and the market to continue to increase without corrections. You are investing "X" in every paycheck, and not selling it for 20+ years. Why would you want the price of the stock to continue to rise, lowering your buying power, resulting in less shares to sell when you are ready to retire. Dollar cost averaging is what makes long term investing so beneficial, buy the highs, buy the lows, jut keep buying.