Don't Time the Market, Bah!

"Don't time the market" is an archaic term, introduced at a time when the market had less liquidity, and prior to the advent of internet investing. With high flyers such as MU and SNDK dominating the market, one would be foolish to assume they can get in at any level, totally disregarding the current market sentiment. This movie airs at least once a year. The bagger at the neighborhood grocer shares rumors of the impressive gains the paperboy got from a tip he received from the shoeshine boy, and so on...all while smart money plans their exit. But wait...why is smart money exiting if the consensus is not to time the market? The same reason why institutional investors pump a stock after their position has been established. To create the ideal environment to pass their bags off to you. The last investor to get in is typically the first to get burned. Unable to withstand the bloodshed, they sell. This triggers the previous wave of investors to sell, exacerbating declines...and the sell-off intensifies. Do yourself a favor...establish your positions during extreme pessimism, and when the market goes on to establish higher highs and higher lows, you'll have a buffer to protect yourself from exponential losses. You can also invest at any level and wait years to see your position turn a profit. Your choice.