When there’s volatility in the market or world events hint at a crash happening soon, you have a few choices. You can ignore everything and let the market take you for a wild ride. It might be suggested you outsmart the market by selling or buying your assets to save your investments. Still, others would tell you to move everything to cash.
Each of these ideas might resonate with you to some degree. But are any of them better than the others?
A recent article in Market Watch described a group of Vanguard investors who moved their accounts entirely into cash when the market tumbled. By doing so, they answered the question, “Why not just get out of the markets entirely and switch into cash?”
Perhaps you’ve had those same feelings as you watched your portfolio lose value during the most recent crash.
The Vanguard group isn’t the type to make frequent trades. “Between February 19 and May 31, only 5% of the self-directed defined-contribution plan participants traded at all. Among retail self-directed households, 17% made some trades. For both sets of investors, less than 0.5% of clients moved into an all-cash portfolio.”
Reading further, the article labels these investors as “cash panickers.”
How Did The Cash Panickers Do?
“At the end of March, the cash panickers had done better, with an average 57% sporting better returns.” However, as the market rebounded, that all changed.
By the end of May, the defined-contribution and the retail cash panickers were averaging 85% worse returns than what their portfolios had before the March Crash. As the S&P 500 and other major instruments continue their surges, you can bet those numbers are even more skewed.
What If There Was A Better Way To Switch To Cash?
The Vanguard group had the right idea, just not the proper tools to have it work to their advantage. Several companies offer robo investment advisors or robo trading. At iFlip, using the best algorithmic trading software, their A.I. goes beyond anything the other companies promise.
See Robo Advisors VS A.I. Investing. What’s the Difference?
You see, iFlip’s A.I. gives you automated investment management with machine learning. This isn’t a trading platform. It’s an investing platform protecting the downside and producing greater returns.
See How iFlip’s A.I. Performed During The 2020 Crash
How Does It Work?
True Algorithmic Intelligence (A.I.) only exists when it has the ability to change its own rules. It has to be able to be a learning machine and do so without human interference.
iFlip offers the first A.I. driven customer investment vehicle on the market. The A.I. SmartFolio.
Utilizing algorithmic trading software in the best mobile stock app as well as online, A.I. analyzes the markets daily. It then determines if it should buy, sell or hold (move to cash) the positions in your A.I. SmartFolio.
By allowing A.I. to do this without human emotional involvement, you get the most effective and highly efficient mechanism available for the average person to use when investing in the stock market. There’s nothing like it! iFlip is creating wealth through access to A.I.
Get all the details at iFlip.
