What he means is despite year-after-year of positive returns, investors are still dissing this market. For years they’ve doubted the (very real) solid market fundamentals. They’ve said the market is too high and can’t go higher (it has). As Rodney Dangerfield would have said, this market can’t get no respect.
In all fairness, it is unsettling to see the market go higher without a pullback. Pullbacks are a normal occurrence, and usually happen at least once per year. It’s been longer than that since this market has had a real shake-up, and we all wish we would get one, get it over with, and move on.
As the investment executive said today, “Everyone wants there to be a correction so we can buy into it.”
And that’s the bottom line as we go into the New Year. We really want to see a correction so we have an opporunity to invest, but at a cheaper price point. Unfortunately, most of us can’t sit around until that magic “sale” sign goes up. If we want a piece of this market, we have to buy into it gradually, little by little, by choosing the best entry times and places.
We all love it when the market goes up, because our portfolio values go up too. But at the same time, higher market values make it hard for us to buy in, and to buy in as cheaply as we might like.
As we go forward into the New Year, decide what kind of market participant you want to be. Do you want to be an Owner, who loves higher investment prices because they make you feel wealthier? Or do you want to be an Investor, who loves lower prices – and corrections – because they let you buy in cheaper, building wealth for the long-run?
Only one of you might get the market you crave in 2018.