It is an unban myth that you can not time the market. Many HFs managers are timing the market all the time, contrarians are doing that, Warren Buffet is doing that especially during the BEAR MARKET. Let alone the acute traders. They do it every single day. What it should actually say is that, you can not time the market in Perfection (e.g you get it right 100%), noone ever. However it is a game of probability, they just need 50%+ right to beat the other alternative e.g not timing the market.
The people who are timing the market are mainly investing in individual stocks, high risk/reward fund, not index fund or global tracker or globally diversified funds. Also they have analytical, good understanding of fundamental and technical analysis, the first people to get various news regarding the stock market to gauge the best time to strike. By knowing fundamental analysis they know for instance when good stocks are selling at a discounted price. Similarity with technical analysis they could identify when good stocks are oversold or overbought.
Without good knowledge of Fundamental Analysis, Technical, stock market news, it is actually just gambling.
This is just one examples of many HF managers
(We’re still 50% in cash, and I wish we would’ve stayed at 70%, says Loup Ventures’ Gene Munster)
For ordinary people investing in blue chip good stock or fund containing a lot of high growth stocks DCA (E.g time the market with drip feeding rather than Lump-sum in one go) especially during the read days will normally beat Lump sum during the BEAR MARKET . There is a research showing about this.
Just imagine those who threw lump-sum £100k+ in either day during November 2021 to April 2022 especially in tech high growth stocks or fund containing a large number of high growth stocks. What happen with their money now, going down 50%-70% ??
This is the statistics about average cash level of fund managers.
If you are asking the IFAs, they will tell people to throw money in one go (e.g Lump-sum) as soon as you have it, as it is less hassles for them. Also it will lower their risk of getting sued. For Fund/Trust Managers the standard answer to retail investor is also not to time the market as they have incentive for that. By not timing the market they will benefit from the constant cash inflow to their funds. Imagine what happen to their Funds if an influx people are suddenly withdrawing their money and then later the same influx of people suddenly put their money back.