By Tom Bradley

In my recent article, The Party is Rolling Again, so be Cautious, I throw a little cold water on the market rally we’re enjoying. I think it’s important to reiterate how a view like this relates to an investor’s asset mix.

The key line in the article is near the end – “I've sold stocks to bring my equity weighting down to the bottom half of my range.”

As an investor, that means:

• I have no expectation that my timing will be anywhere close to exact.
  
• I haven’t exited the market. I am hoping the market continues to rise because I own lots of equities.
  
• If the market does go up, it won’t mean my caution was inappropriate. It’s all about finding the correct balance between reward and risk.
  
• For illustrative purposes only, if my range for stocks is 40-60%, then I am now under 50%. This compares to mid-summer when I was at the top end of the range, or over.

As we say ad nauseum, we are not market timers. From time to time, we will shade our portfolio in one direction or another, but it’s always based on valuation, done in the context of our long-term asset mix and...executed without emotion (I know we’re boring).

So if you agree with my view, should you get out of the market? No.

Is it time to re-balance? Possibly.