Should you buy ASX shares now or wait just a little bit?

During market corrections, investors always grapple with the question of when to go bargain hunting.

Despite a mini-revival the past couple of days, the S&P/ASX 200 Index (ASX: XJO) is still down about 7% this year.

But with interest rate rises still to come in the United States and Australia, there could be more volatility ahead for ASX shares.

So many investors are now scratching their heads, asking themselves whether they should pick up bargains now or wait. After all, stocks could be even cheaper later this year, right?

Switzer Financial director Paul Rickard had an answer for this dilemma in a video this week.

An ASX investor in a business shirt and tie looks at his computer screen and scratches his head.

Image source: Getty Images

Save some ammo for later

Rickard said he had grabbed some Xero Limited (ASX: XRO) shares last month, but other than that he hasn't yet "rushed into" bargain buying.

"I just felt that the lead out of the US was too strong," he told Switzer TV Investing.

"Clearly we're not going to get any clarity on the Fed[eral Reserve] until March. It only takes a couple more outlandish figures and suddenly the market will go from talking 4.5 [rate] increases to talking 7 increases."

Until that uncertainty has settled, Rickard feels like there could be more price falls to come for ASX shares.

"That's going to produce some more [buying] opportunities… Hold a bit of powder."

Having said this, Rickard did remind ASX shares investors that trying to pick the bottom is a futile exercise.

"I never try to pick the bottom. I will not pick the bottom. I know that," he said.

"But I just feel we've got a little bit more in this [correction]."

Could the federal election produce an unstable government?

Another cloud over share markets that concerns Rickard has not yet been widely discussed in financial media.

"The other thing that worries me locally is the [federal] election," he said.

"I know that's not till May, but you look at the poll this morning in The Australian, that's a horrendous poll [for the incumbent]."

The federal budget will be handed down on 29 March, with an election likely to be called soon after that. It must be held at some time in May.

The ruling Coalition will be judged on its handling of the COVID-19 pandemic, especially the way it navigated the latest Omicron variant.

Labor leader Anthony Albanese will be putting the case forward for a change of government.

"The odds are going to be a weak Albanese government with [supportive] independents, or a weak prime minister," said Rickard.

"There's a bit of political risk here in our markets… I'd be a little bit careful."

Motley Fool contributor Tony Yoo owns Xero. The Motley Fool Australia's parent company Motley Fool Holdings Inc. owns and has recommended Xero. The Motley Fool Australia owns and has recommended Xero. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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