Even if SPY goes down 30% from here, there are likely many stocks out there that have already hit their bottoms.
We’ve all seen the countless posts just showing how little the SP500 has dropped in relation to historical crashes. The implication is that you shouldn’t be long in this market yet because SPY isn’t even close to hitting bottom.
If you’re an individual stock picker, hopefully you already know that, even if true, this thinking will have great opportunity cost.
Individual companies bottom at different times. The cascading domino effect is what is slowly bringing down the indexes.
If a stock is dirt cheap relative to its future outlook, you buy. Pay zero mind to the indexes.
For example, If you bought Nike or Amazon right as the SP500 bottomed in Sep 2002, you would have missed out on tons of gains. Nike bottomed in feb 2000 below $2.50 and was well over $4 when SPY bottomed.
Amazon bottomed in September 2001 and was a 3 bagger by the time SPY bottomed.
If you know a company’s stock is way too cheap, ignore spy, just buy it.
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