what Richard is saying above is that the average investor doesn’t have a clue when to get in or out of the market so they do so based on the emotions of greed and fear – when the markets are moving up they think they are missing out on ‘free money’ so they buy into the top third of a bull market – near the bottom third of the following bear market they sell because fear has finally gotten strong enough
Wall Street tries to ‘help’ the average investor by acknowledging the investor’s lack of knowledge and providing them with a strategy: buy and hold and dollar cost averaging
again, how is that strategy working out for you?
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Again, I said that “I am assuming that we are currently in a bear market and a long period where stocks will underperform, so I am playing the cyclical 3-5 year moves.” I know that most investors get it wrong. Although I don;t follow the DOW or the DOW letters for that matter, I fully understand the psychology that drives people to make those mistakes and I aim to profit from them. While others are selling in the current cyclical bear market I am averaging in. If I am to be correct, then I expect to be of the minority opinion most of the time.
