Watch for This Buy Signal Before Jumping Into Stocks. It's Right 9 Out of 10 Times.

Market Overview - The S&P 500 is approximately 6.2% below its all-time high of just above 7,002 reached in late January, indicating that the market does not appear to be under significant stress [1] - The CBOE Volatility Index (VIX) recently surged above 30, suggesting that investors anticipate a 30% movement in the S&P 500 over the next 12 months, indicating a market on edge [2] Historical Context - The VIX spiked above 60 in April 2022 following significant tariffs announced by President Trump, which marked a market bottom, leading to a rally for the rest of 2025 [3] - Historically, when the VIX exceeds 40, the S&P 500 has been up more than 30% on average a year later, with stocks rising over 90% of the time in the following 12 months since 1990 [3] Current Market Sentiment - Although the VIX has not yet reached 40 and has pulled back due to hopes for an end to the war with Iran, the market remains on edge due to concerns about the war, oil prices, the economy, and potential AI bubbles [4] Investment Strategy - Companies suggest maintaining a consistent investment strategy without waiting for a market sell-off or a VIX spike above 40, recommending core index exchange-traded funds (ETFs) like the Vanguard S&P 500 ETF and Invesco QQQ Trust for long-term wealth building [5] - Given the recent spike in market volatility, it is advisable to keep some cash reserves to capitalize on potential stock dips, particularly if the VIX crosses 40, which has historically been a strong buying signal [6]