With markets making new highs & topping headlines recently, it is tempting to get swayed by the market noise. Timing the market never works unless you get lucky. But you cannot get lucky every time by accurately predicting the peaks and troughs. Neither does it matter when you are in for the long haul.
Should you wait and stay invested? But what if the markets take a U-turn from here? Should you sell? Then, what if the market goes up further? Are you confused? Then try asking yourself these questions:
- What is my current asset allocation? How do my equity & debt buckets look like? Do they need rebalancing?
- Which share or fund I should choose to sell? Has anything changed about them fundamentally? Have they been underperforming for a while?
- What would be the tax implications of selling?
- If I sell, do I know what to do with the money? Do I need it for any upcoming goal or any emergency? Or should I reinvest in another stock or mutual fund and weed out the bad guys from my portfolio?
- If I stay invested, what impact it would have on my long-term goals?
Answering these questions will provide at least some clarity and direction. Personal introspection with your own portfolio & financial situation will help rather than focusing on the market noise. Remember, personal finance is personal!