2. Risk-on / Risk-Off Investors missed big up-moves.
Europe proved particularly problematic for risk-on / risk-off investors. "Many EU stocks performed miraculously," said Cramer.
But had you switched into risk-off mode - you either missed the move or worse
"Had you flitted from risk-on to risk-off and back again you probably sold low and bought high pretty regularly," said Cramer.
In other words, the 'riskiest' moments – when you'd otherwise rotate into bonds –ended with big gains in stocks.
What's the point of this analysis?
"I ran money for 30 years before this "risk-on, risk-off" strategy came into play," said Cramer. "I am beginning to believe that it is simply a by-product from those who refuse to do individual stock homework or can't think of anything to say.
And according to Cramer nothing is more important than doing homework; that is sifting through earnings reports and doing research to identify a company with solid fundamentals, good management, strong growth potential and one that trades at a reasonable multiple.
When compared to risk-on / risk-off, homework may seem tedious and old fashioned but sometimes the best investment strategy is the one that's stands the test of time.
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