Market crashes are never timed properly. As Keynes once said, "Markets can remain irrational longer than you can remain solvent". Simply put, trying to position yourself for the ultimate market fail is not prudent and often will cost you a great deal of your wealth. Why is this? Well, many of those looking or hoping for a crash miss out on many components against such an event occurring.
I'm hearing lots of chatter these days of speculators trying to front run a crash. The problem is, you can't do it unless you are incredibly lucky. Who wants to rely on luck? It's like not carrying car insurance for 10 years, never being in an accident and then all the sudden you buy it and you total your car. That rarely ever happens.
Further, while bubbles are fueled by speculation, that can run for a very long time. Are we currently in a market bubble? I don't know, perhaps we are. But our job as traders is to navigate through the trade winds and move our sails accordingly. As a sailor you don't tell the wind which direction it is supposed to blow!
The market crashed in Feb/Mar of 2020, and for all intents/purposes crashed in Dec 2018 and Feb 2018. But not many cashed in on those moves down because the Fed came in and quickly engineered a turnaround. Suddenly prices stopped going down and they rebounded sharply, crushing the late-moving bears and dragging the skeptics along for the ride.
While you may wish and hope to catch the big move down, it's simply impossible to time it perfectly. However, when the market juices are flowing bullish and protection is inexpensive, you can buy some puts to defend your portfolio in case the market responds to an adverse event. The recent market crash of 2020 was triggered by the expanding coronavirus into the U.S. and how it might have a negative effect on the economy.
The bullish sentiment at the time (mid-February) was sky high as markets were at/near all time highs. The VIX was in the low teens, and nobody was looking for downside action. When it finally came the markets fell some 30% in a month, far too fast to try and get on board, but the damage was done in a short 30 days.
We're not saying markets won't crash. They will crash, they will correct. But positioning for it is a waste of time, energy and resources. Our advice would be to pay attention to the price action, don't tell the markets what they should be doing, and have some protection on at all times.