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Using Valuations to Time the Stock Market

Ask The Compound

NOTE

Invest with Discipline: Buy on Dips

Implement a disciplined investment strategy by establishing predetermined loss levels for stock purchases. Invest more funds at set percentage declines, such as 10%, 20%, and 30%, to simplify the investment approach and avoid the pitfalls of fluctuating valuations. This method focuses on consistent asset allocation adjustments rather than reacting to unpredictable market conditions, as evidenced by historical bear markets and distorted price-to-earnings ratios during crises.

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