There are bull markets, and there are bear markets. It is possible to for investors to accurately forecast these changes in the market cycle. To my knowledge no one has ever consistently or effectively predicted corrections in the market. I operate under the assumption it is impossible and attempting to do so will decrease the portfolio returns. Corrections are not the same thing as bear markets.

Saying all that, I will move on to what this post is really about. I recently ran into an all too common phrase I refer to as the “Mythical Right Time.” The phrase is any way of saying “that right now you do not feel it is a good idea to be in the stock market.”

I believe the “mythical right time” statement comes from a fear of volatility, even though volatility is normal as mentioned in prior posts. It also comes from a lack of understanding of market cycles. Lastly it comes from not being able to separate short-term assets from long-term assets.

An investor that thinks they will sit on the sidelines in cash and wait for the “right time” to get into stocks, may find themselves always sitting on the sidelines as the game is played.

Markets have been volatile and scary since they bottomed in October of 2009. During these volatile and scary times the S&P 500 has had an accumulative return of around 250%.

Being in the market all the time is vastly superior to being out of the market all of the time. The equities market has really bad days, months, quarters, and years; but over long-term periods it combines the greatest combination of returns and liquidity of any asset class.