With the S&P 500 now at its lowest point in 2022, nearly...

The best indicator and process I’ve found that helps with timing (at least for US equities) is to look at where VIX is at. Both low and high vol regimes have momentum and tend to cluster, so when we are in a high volatility regime I want to stay out of the way until we have clearly entered a low vol regime. We can think of vol as being in roughly 3 buckets (source: all this is from paid research from Hedgeye - highly recommend): 1) Below 20 VIX: low vol, everyone feels like a genius stock picker. Add long exposure in the upper teens, and set stop losses in case you’re wrong and vol transitions to the chop bucket 2) 20-30 VIX: choppy sideways market with lots of action for active trading. Lean short when VIX is at 20, and set stop losses to close your shorts incase you enter the low vol regime. Lean long when you get towards the upper 20s, and set stop losses incase you are wrong and vol breaks out into the fuck bucket (see below） 3) >30 VIX (aka the “FUCK” bucket): basically no equity long works in this environment. Panic begets more panic, so when you’re in this bucket you’ll be seeing days where indices are down 3+% and individual stocks get crushed down double digits. I don’t buy equities in the fuck bucket even if they are down a lot, until vol gets back down to the chop bucket, because the risk of catching falling knives here is high. Someone else might choose to accept the falling knife risk at VIX 35 and get better returns if they happen to pick the bottom.