Are We There Yet?
Mar 15, 2025
When you invest over the long term, you get to see bull markets with their great returns and bear markets where your wealth disappears in what can be rapid time.
I have often said you only need one good bull market. So if you started with $100,000 in 2009 in the S&P500, you would now be a whisker away from $1,000,000. Imagine that. Doing nothing except sitting there in an index fund and reaping huge gains.
But those gains can evaporate quickly and it is one reason why we talk about rebalancing your portfolio at regular intervals. It is always hard to do since you are confident the market will rise indefinitely.
But rebalance we must.
With Donald Trump and Elon Musk set on changing the historical course of the US economy, it is now a good time to sit down and reconsider all possibilities that could eventuate. That, of course, can be a time consuming task and even then there are the unexpected events which you simply can't predict.
But that is why you should rebalance. Because we know that over the long term, rebalancing builds wealth even though at times it feels like you are missing out or not maximising the gains.
We recently introduced technical analysis to our subscribers and how to use it to protect your portfolio from large drawdowns.
The 3 major US indices have now all breached their 200 simple moving average. So perhaps it is a good time to rebalance or hedge your portfolio.
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