The Cash Accumulation Phase Begins

by JDH on April 10, 2021

The S&P 500 is at 4,127, an all-time high.  The DOW is also at an all-time high.  The Toronto Stock Exchange was down on Friday, but it too is just under an all-time high.

Will the markets continue to make all-time highs, forever?

No, that’s not the way math works.

Historically, the saying is “sell in May and go away”.  With continued fed money printing there will likely be continued cash flowing in to the market, so I’m not predicting a crash tomorrow.  But, it is also likely that some profit taking happens at some point, so I am slowly raising cash.

I am raising it slowly and deliberately.  I have some stocks that are up very nicely, so I’ve put in sell orders at slightly above market, for a portion of my holdings, and my plan is to reverse DCA.

Dollar Cost Averaging is a good strategy for entering the market, where you deploy cash regularly, allowing you to catch some of the down days.  Selling is the same, in reverse.  I pick a target, and put in an order to sell 10% of my shares at that target, and then 10% more slightly higher, and so on.  The goal is to enter the month of May with more cash than I have now.  I will still have stocks, so it the market continues upward, I benefit, but if we have a correction or crash, I’ll have cash to re-deploy.

And what should one do with the cash?


And Ethereum.

And whatever alt-coins you want to speculate in.

I am not suggesting you take your entire fortune and put it in some “shit coin”. That strategy may make you a billionaire, but it is more likely to wipe you out.

In my main investment account I have approximately 10% of the portfolio in Bitcoin and Ether Funds (QBTC, QETH).  That appears to me to be an appropriate allocation, although I will likely increase it over time.

As I write this at 7:45 am on Saturday morning, both Bitcoin and Ether are at all time highs, or very close to them, so that’s the kind of speculation I like.

Stay tuned, we’ll see what transpires going forward.