September 15, 2013 Comments

As of Sunday night, markets futures were up on news that Larry Summers is out of the running for the Fed chair job. Also perhaps on confirmation that Syria will not be bombed.

The Summers news seems to illustrate that in the markets news often comes out of the blue. Most investors are better off keeping a relatively fixed percentage of their money in stocks at all times. Market timing does not seem to be a lucrative approach since predicting the future is always difficult.

It’s basically a sure bet that stock markets rise in the long term. So why bet against that?

With roughly two thirds of my funds in stocks and the rest in cash I figure I can do okay no matter what happens. If markets happen to crash I will be buying and eventually it will likely be proven that the decline was a buying opportunity. But meantime I would have to be willing to live with a decline in my investments.

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