Rule of half

All markets are at *all* time highs. What is an average investor to do? Is it too late to get in? Is it time to take profits if you are fully invested? In the last 15 years there have been two spectacular crashes, the hard memories still linger, which makes these decisions even more gut wrenching.

What to do? How to break the break the cycle of inaction?

I follow the rule of half. Stick to your plan, but halve the amounts. If you invest on a monthly basis (which you should, dollar cost averaging is your best friend!), halve the amounts. This way you are hedging your bets. In the case the market turns, you have some extra cash in hand to buy into the panic. If the market is going up you are still invested periodically and can ride the wave.

If you are fully invested, take some profits off the table on positions with huge outsized gains (be tax aware tho!). Again hedging your bets.

You can never time the market, so a fixed rule strategy is the best thing!

Disclaimer: The Information on this blog is my personal opinion and is provided for education, informational and discusssion purposes only, without any express or implied warranty of any kind, including warranties of accuracy, completeness, or fitness for any particular purpose. This blog is not intended to be and does not constitute financial advice, investment advice, trading advice or any other advice.

YOU SHOULD NOT MAKE ANY DECISION, FINANCIAL, INVESTMENTS, TRADING OR OTHERWISE, BASED ON ANY OF THE INFORMATION PRESENTED ON THIS BLOG WITHOUT UNDERTAKING INDEPENDENT DUE DILIGENCE AND CONSULTATION WITH A PROFESSIONAL BROKER OR COMPETENT FINANCIAL ADVISOR. You understand that you are using any and all Information available on or through this blog AT YOUR OWN RISK.

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