You’ve seen those nail-biter games when everything comes down to a few plays.
It’s a win or lose situation.
So, what does a great coach do? He turns to his best player and says, “Get In There!”
I can envision coach Orgeron saying those 3 words in the championship game.
What Have We Been Doing?
We’ve been gettin’ in there, too. We’ve prepared for the pullback and started to go shopping…lazy bid style.
What’s a lazy bid? Oh, that’s when you put some low-ball bids out there… for great stocks. You do this when the market is down 3-4%.
To us, it’s win or lose. Long-term we know this is a winning strategy.
We aren’t playing for tomorrow, we’re playing for 6-12 months from now.
It’s not often that panic strikes the market with fire-sale prices.
Here’s what a fire-sale looks like when ETFs get dumped:
Check out what epic stock selling looks like:
Anytime we see this level of selling, we like to “get in there.” We even sent out a members only blog post on Friday titled, Time To Go Fishing. It’s full of names we like.
What’s Next For Markets?
So, when will the selling be over? Great question!
We looked back at prior times when huge selling gripped the market similar to now. We found 27 times when selling was 8 times larger than the 50 day moving average.
As for when to buy, the average trough in the market happened 21 calendar days later: three weeks. So, according to this data, three weeks from last Friday, we can expect the market to trough-out.
Here are the results:
Here’s a chart of those instances:
The bottom line is this. People miss out on big rallies in the market and then they pray for pullbacks.
When the pullbacks come, most will clam-up thinking that more downside is coming.
Fear and panic is not a strategy.
If you’re gonna win the game of investing, find the best players in the market and get in there.