I would take a look at historic norms. For instance, the S & P 500 has had an average P/E of about 16.5 during the 20 Century. When stocks went above that, or say 2 percentages points above the norm. I would put my monthly amount into bonds, money markets, REITs and other types of assets. Staying away from stocks, because they were too high. When the US stock market was below the 16.5 norm, I would invest all in US stocks. I would also consider a small part of my portfolio, for more risky investments, like gold stocks and emerging markets. I would use historic norms, for international investing as well. Currently the British Pound is only worth a
$1.53. $2 to $2.5 is more like the norm. So, buying British stocks would be a good idea, using this concept, of investing based on historic norms.
I did go to business school, where I was taught the efficient portfolio hypothesis. I don't think that model was worth very much. It was very sophisticated, supposedly to help you get the most return for the risk available. Major companies offering self directed accounts, did use this, or at least a very similar concept. Mar 2, 2009, when the board market hit a very long term low. That would have been a great buying time. But, how could people be patient enough to wait for that? How would you know at the time, that was the low. It was a great opportunity, but how could people have taken advantage of it?
I don't see any other way, to invest and save for retirement, than by using some sort of asset allocation. As I remember, there were people saying in 1999, that the market was getting a little too high. But, it was March 2001, before the market head down. Making timing the market very difficult. Maybe there is a better way than using
historic norms, but I don't know what it would be.