Beware of market risk: we discuss and point out that market risk is not equal to economic risk and right now, given the high stock valuation, it is actually very risky for stocks. We also point out that does not mean one should withdraw from stock markets.
Consistency is the key to any investment success. Many people just can not consistently follow a well defined strategy with strong intuition backing
Switching to tactical asset allocation in an overvalued stock market can be beneficial, as shown by a modified method based on Shiller’s long term stock market valuation metric.
We discuss whether this is the long overdue correction. We also discuss the importance to have a plan when a prediction goes wrong.