“Five percent CD yields are not coming back any time soon,” Scott Wren, senior equity strategist at Wells Fargo Advisors, said in the article. “Right now with low interest rates and a stock market that looks pretty good in my opinion, there’s not a lot of good things to take from people sitting on cash that is yielding virtually nothing.”
Investors who are thinking about dipping their toes back into the stock market waters should have a strategy in place. While some may fall back to chasing hot stocks or selling off at a bottom, a trend following strategy could help provide a structured investment regiment to limit emotional trades. [Don’t Let Emotions Ruin Your ETF Portfolio]
For instance, at ETF Trends, we try to use the 200-day exponential trading average to guide use through trades. If an ETF moves above the long-term trend line, it is a buy signal, and if the ETF dips below the trend line, it is time to exit the position. [An ETF Trend-Following Plan for All Seasons]
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Max Chen contributed to this article.