Why Smart Investors Know When to Sell

This goes out to the people who don’t sell.

A lot of young investors have started buying ETFs and they’re not interested in timing the market. They don’t pay much attention at all – they just keep buying. Most have bought something like an ETF of the ASX 200 or similar, and they’re not thinking of selling it.

That’s fine – except you should probably think about having exposure to faster-growing markets like the US. Although, let’s just get through this bubble thing first before buying into the US, because there seems to be a bit of a bubble in Big Tech. We might get a better buying opportunity.

The reason you’d sell your ETF – whether it’s the ASX 200, the S&P 500, or the Nasdaq – really comes down to one thing. You sell because you think you can buy it lower down. You can’t take advantage of those buying opportunities if you never sell.

If you’re happy not to take advantage of that, fine. But at some point, you’ll find it’s true that the best opportunities in all equity markets come when we’re coming out of a precipitous moment. We had one in April, for instance – the US market’s up 38% since the low in April.

We had one during COVID. We had one in the Global Financial Crisis. Fantastic buying opportunities. And if you just sit solidly, faithfully, with your fingers crossed and your eyes shut, you’re missing those opportunities.

So how do you know when to sell and when to buy?

There’s only one way to do that, really – and that’s to subscribe to the Marcus Today newsletter.

Timing the market is what we do.

If you don’t want to do that, and you just want to sit in the market, that’s fine too. The greatest advantage young investors have is time – you’ve got a huge runway of superannuation and savings ahead of you. Thirty or forty years of compounding returns.

At this point, if you’ve got a few grand in an ASX 200 ETF, what does it matter? Even if the market drops 50%, you’re only talking about a couple of thousand dollars. It’s irrelevant right now.

It only becomes relevant when everything’s compounded over 40 years and you’ve got a lot of money on the line – like many retirees do.

So don’t fuss too much.

But if you want to be a little smarter than the average Joe, there’s only one way to do that – subscribe to the Marcus Today newsletter.