HERE IS A sage piece of investment advice you might not usually find in any tip-sheet, newsletter or “thoughtful†weekly column on capital markets. It comes from Will Rogers, a popular entertainer and wit of interwar America, via the writings of Paul Samuelson, a Nobel prizewinning economist and wit of post-war America. Are you ready? Here it is. You should buy stocks when they are going to go up. When they are going to go down, you should sell them.
Nice work if you can get it, quipped Samuelson. It is a shame only a few can. Yet the idea of timing the market-all ups, no downs-remains a seductive one. Anyone who invests in equities has at one time or another fancied they can sell at the top and buy again at the bottom, thus enjoying the return from stocks while avoiding the risks. It seems simple. If stocks are dear and investors look heedless, you should get out of the market. When it falls back, as it surely must, fill your boots.
