“Is now the right time to invest, or should I wait for better conditions?”
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Start 7-Day Free TrialThe S&P 500 spent the first half of 2026 setting 24 new all-time highs, continuing a bull market that has stretched more than 3.7 years and seen the index increase by more than 104% since October 2022.
This run, while still shorter than the average bull market’s 5.4 years, comes with its own warning signs. Record levels of tech dominance, which now accounts for more than 37% of the S&P 500 index by weight, have raised concerns over over-concentration.
Concerns about capital expenditures and extreme valuations in Artificial Intelligence have raised questions about whether we are on the verge of the next bubble. All the while, geopolitical tensions in the Middle East remain in the balance, as elevated inflation continues to blur the economic landscape at home.
This balance of conditions gets clients to begin asking questions. Should they wait for a pullback to invest in a market at all-time highs? Should they move to the sidelines amidst these various concerns? Is now the right time to invest at all?
No advisor can answer these concerns with certainty, and no one should pretend to know what will happen next. But the historical record on waiting is much more decisive than the questions themselves suggest.
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The Worst-Case Scenario
The concern for clients is rarely “I’ll get a slightly worse return”, it’s the fear of investing before everything falls apart. Take the investor with the worst timing imaginable: $100,000 deployed into the S&P 500 on February 19, 2020, the absolute peak before the COVID-19 crash.
In just 33 days, the S&P would decline by 33.9%, effectively erasing $34,000 of this investment. Compare this to the investor who took the same $100,000 and spread it out over the following twelve months, dollar-cost averaging into the crash and the recovery that followed.
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Five years later, both strategies advanced by more than 80%, and despite buying at the single worst possible moment, the lump-sum strategy finished just 6.3% behind the DCA approach. While entry timing affects outcomes, the ability to remain invested through turbulence plays a much more important role.
The bigger danger to returns is how investors behave in these moments, especially when it is tempting to get out of the market and wait for conditions to normalize.
An investor who moved to cash for just one month at the bottom of the COVID crash, in an attempt to “wait for things to calm down”, would have sacrificed more than $25,000 over the course of five years.
Someone who moved to cash and never returned? They lost money, earning -2.90% annualized and ending 18 percentage points a year behind an investor who did nothing at all.
The Bigger Picture
When looking over the last 20 years as opposed to a specific crisis event, history favors those who invest early and remain invested. A lump sum investment of $240,000 20 years ago returned 748% total, versus 375% for the same amount invested through monthly DCA contributions. Despite two major recessions, the difference in return would be nearly $900,000.
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The same logic applies to timing an exit and attempting a re-entry. Missing just the 10 best market days over the last 25 years cut annualized returns by more than a third, from 9.55% to 6.06%. Miss the best 50 days and you would be left with annualized losses.
These best days are impossible to predict before they arrive, and they tend to cluster very close to the worst ones. Regardless of the scenario, the pattern suggests that money that stays invested outperforms money waiting for a better moment to arrive.
There’s Always a Reason to Sell
Many of these best days have shown up during periods that felt like exactly the wrong time to be invested. Since 1990, the S&P 500 has weathered the dot-com collapse, the 2008 financial crisis, a global pandemic, and many more events that each felt a legitimate reason to step back.
Today’s AI valuation concerns, elevated rates, and conflict in the Middle East raise the same instinct to step back, yet through all of those, the index has returned 4,320% at an annualized rate of 10.94%.
Is Now the Right Time to Invest?
The answer is that nobody knows what the next six months hold. The data across the worst possible entry point, panicking and moving to cash, and missing the market’s best days all point to the same conclusion: the cost of waiting has historically outweighed the cost of being wrong about timing.
Advisors already understand this, but the challenge is making a client feel it when uncertainty and fear creep into their mind. Having access to visuals that explain these scenarios turns “trust me” moments into “look at this” when headlines get loud.
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