Learn the rules so you can break them. Is now a good time?

There are several dozen chess principles or rules that chess players observe. A good chess player knows the right time to ignore chess principles.

Can the same approach apply to investing?

Yes it can, and now could be the time. The Monday Morning approach to investing equals the US market at all times. Throughout a market cycle (peak to trough to peak) very few investors, including professionals, can equal the US market. The average investor trails the market by 40%.

Monday Morning investors have six habits.

1. Save.
2. Do it yourself.
3. Buy the American market as a whole by investing in an exchange-traded fund that tracks the S&P 500. (No stock picking.)
4. Buy and hold. (No  attempts at market timing.)
5. Rebalance to your asset allocation when market movement in either direction throws it off.
6. Avoid complexity.

Some members have a “fun” portfolio. What do they  do in their “fun” portfolios? They pick individual stocks, trade actively, invest in penny stocks, day trade, trade in derivatives and generally behave in ways that make Wall Street happy.

Nobody needs a “fun” portfolio. However, something worthwhile occasionally comes up in a “fun” portfolio that can be done in a core portfolio, to some extent.

We could be there now.