It’s the Christmas season! What a great time of year.  I remember when I still lived in Pittsburgh.  We would get the kids all dressed up to go outside.  Gloves, hats, coats, boots.  It was a major process, to say the least.  Once outside, they usually lasted about three minutes. Reality Check Time This whole presidential election pointed out; yet again, that no one knows when the stock market is going to go up or down. Please repeat after me:  No one knows when the stock market is going to go up or down.  For months now, article after article warned that a Drumpf victory would bring on stock market disaster.  Some examples: A Huge Hedge Fund Says Stocks Will Crash if Donald Drumpf Wins Stocks Will Likely Crash If Drumpf Wins A Drumpf victory would cause a stock market crash and plunge the world into recession Now I am certainly not going to turn this into a political discussion, but it perfectly illustrates the number one misconception among my clients.  Here are some common refrains I here in my office each week: “Dave, nobody can time the markets exactly, but you can still ‘stay on top of things’ to increase your return.”  (False) “Dave, wouldn’t it be better to keep all the money in cash for a while?  It looks like the market is going to go down.”  (It might.  Or it might not. )  “Dave, I try to catch a little bit of the financial news each day so I can keep an eye on things.”  (Why?) I know this might be hard to accept.  Everything you hear from all the financial pundits is based around one central premise:  Super smart Wall Street guys can make you more money than a good, old-fashioned, diversified and balanced portfolio. They can’t.  I could list literally dozens of academic studies that bear this out.  Here is a great, and lengthy, presentation debunking almost every market timing theory ever (via NYU):   http://people.stern.nyu.edu/adamodar/pdfiles/invphiloh/mkttiming.pdf So if you can’t time the market, what do you do?  Answer:  You create a balanced and diversified portfolio of stocks and bonds appropriate for your age and life situation.  (I certainly didn’t invent this strategy.  Why reinvent the wheel on something that has been rolling along quite well for a very long time?) Don’t make this more complicated than it is, and stop listening to anyone who predicts the market.  You are stressing yourself out and wasting your time. Be Blessed, Dave