FPF 163 - When to find the largest investment gains

Jerry Davidse discusses the importance of investing during market downturns, highlighting the significant gains following major market bottoms. He emphasizes the need for a pre-planned strategy to capitalize on rebounds and maintain investment discipline.

Takeaways

• The biggest investment gains often come when it feels the worst.
• S&P 500's major market bottoms were followed by powerful rebounds.
• Average 17.2% return in 30 days after market bottoms.
• 47% average return over 12 months from market lows.
• Don't wait for calm; markets surge before headlines normalize.
• Selling during declines risks missing return bursts.
• Have a plan before the market storm starts.
• Rebalance portfolio and add stocks during declines.
• Keep a multi-year reserve of bonds and cash.