Look at a sailboat. Built better. The sails are made to adjust for the winds. The rudder is designed for efficiency to help steer better. The cabin is built to withstand weather.
A portfolio cobbled together is much like the raft. It floats and appears to be controllable. A portfolio designed with proper engineering in mind does much more and gives you a better ability to reach the destination you have in mind.
Which would you rather have when a storm hits? A raft or sail boat?
Text in photo:
You can’t change the winds; you can,
however, adjust your sails.
Moral of the story: Most people try to adjust their portfolio allocation based on what the market did. This is like letting the wind take you where the wind goes. Markets, like the wind, can’t be controlled.
Instead, design the sails, with the entire boat, to take advantage of any current and wind to be able to steer your sail boat towards your destination; your goal. The process of sailing is much like a process of managing resources to reach your goal(s). It is simply a process to understand what you can and can not control. Getting somewhere is more likely when you understand the difference between what you can, and can not, control.
You can’t jump from a raft to a sailboat in the middle of the ocean. And it’s unlikely you’d jump from a sailboat to a raft if you had a choice. Which are you on with your resources … a raft or a sailboat? How well designed is it? Can it get you to your destination (sailboat) … or just get to you any destination (raft)?