Kevin Mahn says waiting for a dip risks missing rebounds. His firm’s 20-year review found that missing the 10 best days halved returns; missing the 30 best days cut returns 84%. He recommends staying invested according to risk tolerance and keeping cash for opportunities.
Mahn expects multiple 1%–5% pullbacks before the U.S. midterms and sees them as chances to deploy cash. He says a more severe escalation in U.S.-Iran tensions that keeps oil above $110–$120 a barrel for a sustained period could worsen inflationary pressures and lead markets to expect more rate increases. A decline of 10% or more would be possible in that scenario, but Mahn says it is not his base case. He favors overweighting stocks while retaining bonds, with equities focused on areas where he sees planned spending, including AI infrastructure, power, water, aerospace and defense, and health-care innovation.
Mahn also points to municipal bonds: his firm’s 25-year review found the 20-year municipal-bond index reached or exceeded a 5% yield in 6% of months. In those instances, yields averaged 80 basis points lower a year later. He says falling yields can lift bond prices while investors receive coupon income, but stresses that the historical pattern is no guarantee. Rates can rise and lower bond prices, and municipal bonds carry issuer and credit risks.
