I am not superstitious. And I don't believe in karma, as much as it would be nice to think that people really do get what they deserve.
There is no universal force only sending us what we can handle, either, I'm sorry to say.
There are just circumstances. And our responses.
Sometimes, circumstances suck. I wish there was something or someone upon which to vent our frustrations for causing (or allowing) the bad stuff that happens.
But… there's not.
All of which is to say – and I might be trying to convince myself here – I don't think I'll jinx things if I write about the ASX being at (or near) an all time high at the moment…
I hope!
It is something of an occupational hazard, though – I've been doing this job for the last 13 or so years (how's that for a number for the superstitious!), and I've regularly encouraged our readers and members to keep investing for the long term.
Sometimes, when the market swoons (COVID, anybody?) and sometimes when it's soaring.
And inevitably, just based on the law of averages, I'll eventually do it just before the market crashes one day.
Is that day, today? I don't know.
But, jinxes and superstitions be damned, I'm going to do it again.
And this time, I'm doing it because the market is near a record high.
In doing so, I want to go back to the end of January 2022.
There must have been some market ructions at the time, because I tweeted:
Investing through your first 'correction'?
Not the first time, but it still hurts like hell?
I hear you.
I don't have a solution. At least not to get rid of them.
But I can tell you the market has never failed to regain, then surpass a previous high.
Then followed it up with:
A guarantee? No.
Giving one would be morally and legally irresponsible.
But I think it's very, very likely it happens again.
If I'm right, investing (or staying invested) now will be a profitable endeavour.
That's the reward for sticking it out (and investing more).
I am.
And now? Well, we're at (or very near) all-time highs, with the market up 17.5% or so since those tweets, and probably closer to 26%, including dividends.
Aha! So you're taking a victory lap, Phillips?
Nope.
Not even a little bit. For two reasons.
First, victory laps are, frankly, silly. They're just ego and self-satisfaction.
But more importantly, I don't know what happens next. Nor does anyone else.
Maybe the market soars from here.
Maybe it drops 30%.
I don't know.
But hang on… I'm in finance. I'm supposed to know, right?
Nah.
I mean, that's what some of my industry peers would have you believe.
But no-one knows. Especially in the short term.
That goes for professionals and amateurs alike.
When the market was in a 'correction' (a silly term that just means the ASX has fallen 10% from a recent high), plenty of people told me to wait until things improved, before investing.
But also, when the market is at record highs, other people tell me to wait and 'buy the dip'.
There is no shortage of people whose ego leads them to think they know what'll happen next.
Meanwhile?
Meanwhile, I just keep investing.
Why?
Well, if it's true that none of us know what's going to happen next (it is!)…
And if it's true that, as I said back in January 2022 (and before, and since) that the ASX (and the US for that matter) has never yet failed to regain, then surpass, a record high…
… then my approach is to back the human desire and drive for progress.
True, not every company is pursuing 'progress' the way I (or you) would.
But they're meeting existing and new customers' needs and delivering on their new and old wants.
As I said back then, there's no guarantee that the future looks like the past.
Still, given we can't tell what'll happen in the short term anyway, I reckon the choice is whether to invest on the basis that the future will be brighter than the past, or not… and watch your money eaten by inflation.
Yes, cash doesn't have investment risk, that's true. But nor does it have the upside of investing in shares.
Yes, shares can be risky, especially if you don't have a quality, diversified portfolio. But we've just talked about the fact that markets have tended to rise, strongly, over the long term, so that risk is meaningfully mitigated, I reckon.
Now, I can't tell you what you should do.
Only you know your goals, objectives and risk tolerance.
If you can't stomach volatility, please don't invest – you'll end up selling at the wrong point, just to make the discomfort stop.
But if you can?
I mean, you can try to time the market if you want…
But I wouldn't. I'm yet to see it done well, consistently.
So what's the alternative?
Well, all I can tell you is that I've been investing for almost 30 years.
Through recessions and booms. Fear and greed. Irrational exuberance and grinding pessimism.
I didn't try to time the market. I just saved regularly, invested steadily, and stayed the course.
Which is precisely what I aim to do for the next 30 years, too.
I reckon that's a pretty good strategy for you to consider.
Fool on!
