[wonnage]

It’s probably not even a good idea to try and defend against the bubble by switching up your stock allocation. After all the whole reason passive investing works is that active investment rarely beats the market and if you’ve just been in SPY the whole time it’s unlike you have any edge to gain by switching to an active strategy every time fear creeps up

[izacus]

All of that is only true if the market is sufficiently diversified and not manipulated for profit extraction.

Right now it's not clear that is true.

[wonnage]

It’s one thing to predict a crash, it’s another to actually make money off of it. If you’ve watched The Big Short even those who predicted the housing crisis correctly nearly lost their shirt before and after it happened because timing the crash is the hard part. There is a whole body of research showing that passive strategies outperform active after crashes