YES

Will Skeean, partner, Edge Capital Partners LLC
 

Price is the key factor that determines an investment’s profitability. As economic fundamentals deteriorate (and will do so for several quarters), the “price” of stocks (price/earnings ratio) has fallen to levels that imply attractive long-term returns. While we see a meaningful probability that the S&P 500 reaches 600-650 in the near term, the potential decline of an additional 5 percent to 15 percent is outweighed by potential upside once earnings flatten, multiples increase and sidelined investors rush back to not “miss the rally.” The next few years are likely to be more volatile than most investors are accustomed to. These are not “buy and forget” markets. We are taking this opportunity to upgrade our portfolios by buying well-capitalized, growing businesses that will survive the economic malaise and profit from the recovery. Challenging markets call for decisive action.

No

Mike Hines, president and founder, Consolidated Planning Corp.

The government is infusing billions of dollars into the system to try to stave our country’s economic bleeding. Will this strategy work as planned is anyone’s guess, which is why investing new money into the market may not be a wise option right now. If the dismal economic outlook and chilling news headlines are causing you stress and to lose sleep, now may be a good time to get your financial house in order, hold high-quality bonds or cash —- especially if you will need it over the next five years. Given the uncertainty, focus on building your cash reserves to cushion against a potential job loss, paying off debt or saving for your teenager’s college education. Dollar cost averaging your investments back in is a more cautious way of re-entering the market. We will weather this storm, but if you want to play it safe, cash is king for now.