When In Doubt Throw To Cash!

Jan 18th, 2009 – Comment

Mike from Niagara on the Lake, ON writes about his RRSP: Lou-love your show! I’m 45,with RRSPs in mostly a balanced portfolio which is down ~40%. My gut is telling me the market will continue to fall in 09. Should I continue to ride the wave, or try to move some or all of it […]


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Mike from Niagara on the Lake, ON writes about his RRSP:

Lou-love your show!

I’m 45,with RRSPs in mostly a balanced portfolio which is down ~40%. My gut is telling me the market will continue to fall in 09.

Should I continue to ride the wave, or try to move some or all of it into cash/govt bonds? Never tried timing the market but it hurts to do nothing! I plan on  continuing to  do dollar cost averaging buying  balanced funds, equities, etc.. with future purchases.


Hi Mike,

I have always held to the simple rule of when in doubt throw to cash and always trust your gut!  Yes you will take a loss on paper but if the markets turn up you can get back in. Yes you will have to pay commissions to get out and back in but lets face it, from your email it sounds like you need to get in out of the rain, get dried off and then look for new opportunities.

Always Trust Your Gut!

Always Trust Your Gut!

The MACD does seem to be turning up but there is also resistance to an advance. The last candlestick is a doji which suggest uncertainty about market direction. The moving averages are not screaming buy either so it could be a good time to get out of the rain and warm up.

From the chart the best opportunity for a run is if the index moves above 10,000. After that you can see that there is light resistance to 12,000. Clearly we are in a trading market so if you are not a trader there is nothing wrong with throwing to cash.

Happy Capitalism!

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