BOSTON — It's a question made for Hamlet: Should you hang in there and suffer the slings and arrows of a turbulent stock market, or face another challenge - figuring out something smarter to do?
Here are some arguments for both sides:
Option 1. Status quo: Whether equities are in a dip or rout, investment gurus generally agree about the folly of trying to time the market - finding the right moment to exit, and later to reenter at a lower price.
Investors heard similar cautions that stocks were overpriced two years ago, and what followed was a 70 percent surge.
Also, defensive strategies can be tricky to implement. Some "contrarian" funds, which aim to go up or at least protect your money when the market drops, have fallen lately along with their bullish rivals. And in an upswing they may do terribly.
The greatest risk, experts say, is being out of the market when it's rising.
So, stick with your long-term plan. If you're edgy, maybe you need to reevaluate your asset allocation among stocks, bonds, and cash to conform more with your tolerance for risk.
Option 2. Do something: Sure, it's hard to time the market, but we just saw interest rates start rising last month. Historically that's been bad for stock prices.
There have been 29 bear markets - drops of 20 percent or more - since 1900. Occasionally it takes years to fully recover.
Because of the difficulty of timing the market, experts in this camp still don't advocate selling everything.
But they note that much of the money now in mutual funds has arrived in just the past few years. Should stocks slide more than their recent correction, no one knows whether some of these investors might sell and send the market down even further.
One option, especially if your money is in a retirement account where capital gains aren't taxed each year, is to move some money into a money market fund or into a defensive stock fund, such as a real estate fund.
To decide if you want to shift some money, do some research on your funds. Morningstar and Value Line mutual fund reports, available in most libraries, can tell you if a seemingly conservative fund has a huge position in the volatile technology sector, for example. Value Line's fund profiles also show how a fund has done in past bear markets - if the fund was around way back then.