There is a stock exchange saying that goes something like this:When the taxi driver starts giving stock tips, the market peak is near”

Some even call it the “taxi driver’s rate,” an updated version of the “shoeshine rate” (of course, you don’t see shoe shine boys these days). If robotics make taxi drivers redundant in the future, it will probably become a “barber’s pointer” or something like that.

Either way, the wisdom of contrarian investing is the same. When people who typically don’t have much interest in the market start giving stock tips, it suggests there may be a lot of buzz around.

Therefore, it may not be the best time to stockpile, even though the stock market is a proven wealth-building machine over the long term.

But doesn’t it also work the other way round? This means that there are many concerns today about conflict in the Middle East, inflation, higher interest rates, an unstable global economy, sky-high government debt, and even future job losses due to artificial intelligence.

Despite this scary situation, could now be a good time to start investing?

Play it shrewd

The first thing to note is that uncertainty comes with the territory. There’s simply no way to say with certainty where stocks are headed over the next few weeks or months, or what huge macro iceberg lurks ahead.

This is probably why so many people prefer to hold only cash. It provides a sense of security, even if inflation continually erodes the purchasing power of that cash over time.

However, to alleviate uncertainty, a risk-averse investor could do a few shrewd things:

• Build a diversified portfolio of high-quality stocks, mutual funds and ETFs.
• Invest regularly to silky out the natural ups and downs (known as pound-cost averaging).
• Invest across sectors and geographies.
• Keep your position size in check (no single stock makes up, say, more than 15% of your portfolio).
• Keep cash in an emergency fund.
• Think long term.

Europe looks budget-friendly

So, is now a good time to start investing? I don’t understand why not. Because even when the market is near an all-time high, not all stocks are exorbitant. This is where valuation considerations come into play.

Moreover, not all exchanges are the same. For example, those requiring technology Nasdaq-100 historically speaking, it is still exorbitant, even though it has dropped by 10% recently. But burdened with dividends FTSE100 appears to offer good value even after forceful performance from 2024 onwards.

One ETF that I think is worth considering is the ETF iShares Core EURO STOXX 50 ETF (LSE:EUE). Tracks the 50 largest blue chips in the euro zone.

The ETF has fallen 8.2% in recent weeks as investors worry about the impact of higher energy costs on European consumers and therefore businesses. Of course, this increases short-term risk.

However, the fund appears to offer solid value, trading at 17 times earnings while offering a dividend yield of 2.6%.

Importantly, there is an attractive level of diversification among these 50 companies. At the top is technological power ASMLwhich is the only company in the world selling extreme ultraviolet (EUV) lithography machines. They are used to create the most advanced microchips.

In banking, yes Bank Santander, BNP ParibasAND UniCredit. It works in luxury LVMH (Louis Vuitton Moët Hennessy), EssilorLuxottica (owner Ray-Ban AND Oakley), manufacturer of Birkin bags International HermesAND Ferrari.