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Monday, May 05, 2014

Bob Brinker's Last Buying Opportunity

Bob Brinker's last "Buying Opportunity" was issued via a bulletin to his subscribers on September 22, 2011.  It read:
September 22, 2011
S&P 500 Index: 1129.56  
In the September edition of Marketimer we continued to recommend a dollar-cost-average on market weakness approach for subscribers looking to add to their stock market holdings. We also stated that in the event an attractive buying opportunity developed between regular monthly investment letter editions, we would post a Special Subscriber Message on the website for subscriber access.  
In our view, the conditions are now in place to justify an upgrade of our stock market view to "attractive for purchase" for subscribers looking for an opportunity to invest new money into the market at attractive prices.  
Following any additional backing and filling that may occur within the vicinity of the recent correction lows, we anticipate that the market will transition into a renewed uptrend based on our corporate earnings outlook into next year. In our view, the S&P 500 Index has the potential to trade into the low-to-mid 1400s range in 2012. 
That was a good time to buy, of course with the markets near record all-time highs, any time in the past has worked out as a great time to buy, even if you bought at the last tops and reinvested dividends.  

With the markets very near their record highs, I can see why he's worried now, but you have to wonder why he missed 1278 and 1353 in 2012 or even a "gift horse buy" at the start of 2013 before the market gained over 32%.

IF you look at a long-term trend chart of the S&P500 on a log scale, you can make a case to say it is about in the middle of its long-term trading range.  Thus my advice is dollar cost average into an appropriate asset allocation for your age.

I can also see why he has remained fully invested since March 2003.  He knows he doesn't add value with his timing.

My advice is ignore all of Brinker's market timing hocus pocus.  If he could really time the stock market, then he
Follow his advice to use low cost index funds then rebalance once a year at a minimum as I recommend in my newsletters.

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