Doing Nothing in a Bull Market

As I continue my quest to clean out my Pocket queue, I came across an article from Ben Carlson on his A Wealth of Common Sense blog called "The Art of Doing Nothing."

In my endless pursuit of the perfect work/life balance, I have often thought about the trap of "busyness" and the perils of pursuing perpetual productivity.  I have written on this topic a number of times, including discussions of Do Nothing Syndrome and the Italian philosophy of La Dolce Far Niente.

In his book Essentialism, Greg McKeown writes about the importance of being selective with our time and efforts.  He suggests:

As you evaluate an option, think about the single most important criterion for that decision, and then simply give the option a score between 1 and 100.  If you rate it any lower than 90 percent, then automatically change the rating to 0 and simply reject it.

It made me think about investment decisions.  How often do we settle for the best of what's available right now, instead of waiting for the opportunities that truly resonate with us?

And how often are we compelled to take action with a portfolio just to feel like we're doing something worthwhile?  Oftentimes the best course of action is inaction.

If it isn’t a clear yes, then it’s a clear no.
— Greg McKeown

How will we know when it is time to actually make a move?  When the weight of the evidence compels you to do so. 

What if the evidence is a little unclear?  Or sort of half-and-half?  As Greg McKeown puts it, "if it isn't a clear yes, then it's a clear no."

In my weekly chart review, I found a great many charts that look like the one above of Home Depot.  Up and to the right.  If that's what your holdings look like, perhaps the best thing to do is nothing at all!


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