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When the German and French presidents agree that all will be done to save the euro and it propels the Dow Jones Industrial Average up 1.5 per cent in a few hours trading, as it did last Friday, it must be time to sell.
After all, it’s not like we haven't heard it before over the past 12 months and then seen markets plummet days later when some other bit of negative news sends briefly optimistic investors fleeing in fear.
As Credit Suisse strategist Atul Lele put it to me recently, the world should not be about “risk -on risk -off”. Lele only has to look at his work schedule to know something is wrong with the world – it’s too busy.
It means everyone is focused on the macro picture that he specialises in but they are forgetting to look at where in the investment cycle we sit and how best to get positioned in equities.
Part of the problem lies in scarring from the global financial crisis. For years investment specialists had been talking about diversification to mitigate risk but in a global crisis it turned out that diversified assets that weren't supposed to have a correlation to equities – such as hedge funds – fell just as hard and fast.
That’s led to some re-jigging of strategy to ensure the correlation mismatch works but it’s a long slow process to regain investor confidence.
In the meantime, investors are not looking at individual companies and their growth strategies and identifying real opportunities.
So the key equity strategy of finding stocks that are undervalued is no different to a decade ago except there is more opportunity now but people have forgotten that simple strategy as fear has driven risk taking to ridiculously low levels.
As proof you only have to look at the massive volumes of US 10-year treasuries sold. There is no doubt investors in the instruments will lose money over the cycle of the asset and if, as expected, there is an inflation surge late in the decade, the losses may be significant.
And yet those investors are so scared of risk in this global environment that they are willing to take a loss to protect most of the capital deployed.
While those retiring today are in a mess from the GFC, anyone with a 15 year-plus horizon has a golden opportunity to buy in cheap to a market that will recover.