Some pundits have raised concerns about the S&P 500’s ability to achieve another 20% return year, citing a recession as a potential catalyst for market volatility. However, experts argue that timing the market is not advisable, even after a strong two-year run.
Wells Fargo senior market strategist Scott Wren predicts a 10-8% return in 2025, which may seem less impressive than previous years’ gains but still offers a solid performance. Others, however, are more cautious and advise against making rash decisions based on fear or a hunch about a potential recession.
The stock market’s past two-year run has been remarkable, with the S&P 500 gaining 28.3% since its peak in late 2021. While this may seem like an unsustainable pace, it’s essential to consider the timeframe and the fact that investors should focus on long-term goals rather than short-term gains.
Rather than trying to time the market or liquidating entire portfolios based on fear of a recession, experts recommend a more calculated approach. Investors should aim to buy value where it can be found while offloading securities that are overvalued at any given time.
Ultimately, timing the market is not advisable, even after a strong run. If your life circumstances change and you need access to funds, consider consulting with a financial advisor to take profits off the table or adjust your portfolio accordingly.
Source: https://247wallst.com/personal-finance/2025/02/15/i-think-a-recession-is-coming-and-want-to-convert-90-of-401k-into-cash-is-this-a-bad-idea