Should I hoard capital in preparation for the market correction?

[Daniel Gibbons]

I think we are all reading the tea leaves and understanding the market correction is just around the corner. My primary home has a ton of equity and I'm playing around with the idea of cashing out in preparation for the downturn. I will use the cash to invest in investment properties. On the other hand, will I be over-leveraged (underwater) once the market turns? If I don't plan on moving, is there really a risk?

[Eamonn McElroy]

History does not repeat itself....but it does rhyme.

You won't be able to recognize a market peak when it happens, nor a market bottom, even if you are a savant.  This is because every single market in the world is made up of irrational actors.  Look at every bubble throughout history.  A few people might have recognized it was a bubble, but could never call the top or bottom.

How about this: continue to invest as long as each opportunity meets your ROI requirements as adjusted for risk and contains a margin of safety? Isn't that a lot more logical and (much) easier to execute than leveraging assets and letting cash sit in a savings/money market account for an indefinite period?