But isn’t that just hubris. Basically you are saying, be smarter than the marketplace, find the opportunity everyone else missed, in a marketplace that adjusts prices by the nanosecond, and which sets prices based on all possible knowable information, including everyone in the world, the smartest, most informed, best capitalized people. There is realistically no way to be smarter than them, is there?
auto investing in an index fund is far more humble and realistic, isnt it?[/quote]
I don’t think there’s a great deal of hubris in dramatically de-risking when valuations are over 2 standard deviations from the historical mean. We have plenty of historical data to back up what happens from these levels.
Arguably… isn’t there just as much hubris in owning stocks at nosebleed valuations and simply assuming that your future return is going to be good because… stocks?
But, yes, most folks should just index and deal with the volatility. Unfortunately, most of these folks can… until they can’t.
