[MRM]

The way to diversify and buy low/sell high is to allocate your portfolio into classes. You identify what percentage of your portfolio should be in each class. Periodically you rebalance by selling assets in the class that is now disproportionately high and put the money into the lagging asset class until your allocation is back in line. When the Dow and S&P 500 are high like this it makes sense to sell some of those assets and buy something in an index or industry that's been battered, maybe an energy index or an international fund.