Is Now The Time To Jump In?

Individual investors are getting restless.  After a tumultuous 2011 which was racked with volatility - investors are somewhat skittish about plunging back into the markets today.  However, the rally that began in late December has continued almost unabated over the last several weeks and the media is ripe with bullish calls that now is the time to get in.   But is it?

Everyday I am bombarded with emails from individuals through our website about various topics which I gladly answer each and every one of.   However, it is also a great contrarian indicator.  What do I mean by that?  Remember as investors our job is to effectively do the opposite of whatever everyone else is doing - if they are all selling, we want to be buying.   If they are all buying, we should gladly be selling to them.   That is how real money is made in the markets - buy low and sell high.   Yet, as we have discussed many times in the past, this is exactly the opposite of what individuals do.

As an example this is the email I received this morning:  "With the S&P having just formed a 'golden cross', an upbeat employment report last Friday, a compelling article by Michael A. Gayed on the MarketWatch site, StreetTalk on a buy signal, and even the Super Bowl Indicator all pointing to the next great bull market, isn't time to go 'all-in' to stocks?"

The writer is correct - we are on multiple ...