We have been hearing the hype for over a year: the 10-year period from 2000 through 2009 was a “lost decade” for stock market investors, featuring two large bear markets and a cumulative loss on the Standard & Poor’s 500 Index of 9 percent. It is true that some investors did not have a good experience over the last 10 […]
Investments
What can investors expect after the market beating of 2008?
U.S.stocks rallied nearly 50 percent from March 9 through the end of July, but investors who had suffered through a historic 16-month bear market remained defensive. What did it mean and what are the chances for recovery? Current economic conditions make the picture even more cloudy. Homes continue to go into foreclosure, jobs continue to be lost, and unemployment hovers […]
Regrets may paralyze some investors
It is bad enough that investors lost a lot of money in 2008 during a frightening world financial crisis. The sudden and swift recovery that began in March may be even worse for panicked investors who had barely a day to catch their breath between swings in the market. Now many investors who suffered through the bear and still regret […]
Those who try to time the stock market get nipped by black swans
Investors suffering during major bear markets are tempted to “time” the market: to sell and avoid the downturn, and then reinvest before the inevitable recovery. It now seems obvious to these investors that anyone with half a brain should have foreseen last year’s credit crisis and massive worldwide fall in asset prices. By selling out ahead they would have preserved […]
If the experts cannot predict the markets, you can’t either
Were you able to predict the global bear market that sucked trillions of dollars out of investors’ pockets in late 2008? In retrospect, it looks like it should have been easy to predict—after all, the subprime mortgage crisis had gone on for a year before stocks started crashing in October 2008. It seems obvious that the economy was collapsing and that […]
Want to be a good investor? Stop making these five mistakes
Most investors could dramatically improve their returns by eliminating five common mistakes from their portfolio management toolboxes. One of these common mistakes is so deadly it could wipe you out, while the others can cost you big time. The most dangerous mistake you can make is betting everything on one investment. This is akin to putting all of your chips […]
Why it is a bad idea to get out of the market in a downturn
Doesn’t it seem reasonable that when the stock market is dropping month after month you should get out, avoid more losses, and wait for the upturn? Unfortunately, this is just what many investors do. Once they are out of the market, they often don’t begin investing until well after a recovery has occurred and it looks very apparent that the […]
Investors’ behavior penalizes growth
The U.S. stock market enjoyed a major bull run in the second half of the 1990s, with the S&P 500 Index climbing an average of almost 29 percent per year between 1995 and 1999. However, it appears that the average investor did not reap much of that reward, says John Bogle, former chairman of the Vanguard Group, a major mutual fund company. […]
Want to give your portfolio an edge? Try investing globally
There are nearly 70 stock markets offering their wares to investors around the globe. Sexy, up-and-coming markets like China beckon, while exotic markets like Turkey’s and Russia’s are growing fast. How should an investor allocate his limited investment dollar? Probably the best method involves following the actual capitalization of the world’s markets, that is, investing the most in the biggest markets and […]
Warning to retirement savers: Don’t reduce stocks as you age
Many retirement investors intuitively believe that they should reduce their exposure to stocks as they age. After all, they have to protect their retirement nest eggs when retirement approaches and cannot afford to lose a big chunk of it in a market downturn, they believe. Recent research by two professors at Lewis & Clark College in Oregon turns this standard […]
