<prompt> Human: I am currently saving for my 3-6 months emergency fund. This will take a while, probably a year and a half. In the meantime, I have a Roth 401k that I have stopped contributing to about a year ago. I have about 3,500 in it and Im put it towards mostly U.S. stocks and a little bit toward foreign stocks. None towards bonds for now. Now, Im really lost about how 401ks work. I hear people saying to just allocate it and leave it alone, but why? Why wouldnt it be better to sell high and buy low? If my stock funds are gaining, why do I just leave it alone when I know it will go inevitably go down again? Sorry if these are dumb questions, I would just like to understand this a bit better.  <response>: the reason why people saw just allocate and leave it alone is that it is incredibly difficult to engage in market timing. the professionals fail all the time so for most of us the buying low cost index funds and getting our allocation right is the best strategy. its hard to get in and out of your positions quickly enough and if you miss just a few big rally days or hit a few big drop off days your overall return is going to be worse off significantly. check out the bogleheads wiki for more on this low cost indexing strategy: but many people do try to time the market and there are some winners and lots of losers. statistically speaking youll more likely underperform the market over a long period of time but that doesnt mean it cant or hasnt been done. 