Anyone have any specific market signals they use to gauge when to full port or take risk off the table—that work? Here’s mine:
I’m not really a fan of trying to perfectly time the market and/or sitting in cash awaiting a dozen of signals to align. But I do have a few things I’ve started looking at to decide whether it’s time to go aggressive or take a little risk off.
One of the things I use is the good ol’ VIX. I keep a bit of cash on the side and start putting it to work when it gets above 30. Some of the recoveries after those periods have been insane. You can basically get years worth of normal gains in a matter of weeks. Even if I don’t nail the exact bottom, I feel like the risk/reward is pretty good when volatility gets that high.
I know some people use moving averages, historical divergence of p/e valuations or even seasonality like midterms or certain months to decide when to ease in or out.
Any tried and tested signals out there that you’ve benefitted from or like to regularly abide by?