http://www.theinvestorsjournal.com/how-to-avoid-market-corrections-and-crashes/ Realistic Advice for Successful Investing. Mon, 22 Feb 2010 22:00:36 +0000 http://wordpress.org/?v=2.9.2 hourly 1 http://www.theinvestorsjournal.com/how-to-avoid-market-corrections-and-crashes/comment-page-1/#comment-4540 sandrar Thu, 10 Sep 2009 14:22:49 +0000 http://theinvestorsjournal.com/blog/2007/09/01/how-to-avoid-market-corrections-and-crashes/#comment-4540 Hi! I was surfing and found your blog post... nice! I love your blog. :) Cheers! Sandra. R. Hi! I was surfing and found your blog post… nice! I love your blog. Cheers! Sandra. R.

]]> http://www.theinvestorsjournal.com/how-to-avoid-market-corrections-and-crashes/comment-page-1/#comment-4358 farouk Mon, 17 Nov 2008 12:56:35 +0000 http://theinvestorsjournal.com/blog/2007/09/01/how-to-avoid-market-corrections-and-crashes/#comment-4358 i strongly agree , market crashes can be predicted i strongly agree , market crashes can be predicted

]]> http://www.theinvestorsjournal.com/how-to-avoid-market-corrections-and-crashes/comment-page-1/#comment-2067 Peg Mon, 11 Aug 2008 02:37:21 +0000 http://theinvestorsjournal.com/blog/2007/09/01/how-to-avoid-market-corrections-and-crashes/#comment-2067 please give me a heads up when you think i should go "all cash"! please give me a heads up when you think i should go “all cash”!

]]> http://www.theinvestorsjournal.com/how-to-avoid-market-corrections-and-crashes/comment-page-1/#comment-434 Adam Freedman Sun, 13 Jan 2008 04:15:31 +0000 http://theinvestorsjournal.com/blog/2007/09/01/how-to-avoid-market-corrections-and-crashes/#comment-434 J.D. I know what you're saying and I pretty much agree. I didn't mean for this article to be about timing the stock market. I wrote this article because *sometimes* it just becomes clearly obvious (atleast to me) that there is more risk than reward in long term investments, and the best strategy would be to go 100% cash. And 2007 was one of those years where I saw the signs and interpretted them correctly. <br/> Also, for the chart picture you see, my portfolio had very little single stocks in it. In fact most of my portfolio at the time was made up of broad range S&P 500 type ETFs. J.D. I know what you’re saying and I pretty much agree. I didn’t mean for this article to be about timing the stock market. I wrote this article because *sometimes* it just becomes clearly obvious (atleast to me) that there is more risk than reward in long term investments, and the best strategy would be to go 100% cash. And 2007 was one of those years where I saw the signs and interpretted them correctly.

Also, for the chart picture you see, my portfolio had very little single stocks in it. In fact most of my portfolio at the time was made up of broad range S&P 500 type ETFs.

]]> http://www.theinvestorsjournal.com/how-to-avoid-market-corrections-and-crashes/comment-page-1/#comment-432 Jim Pahno Sun, 13 Jan 2008 02:17:01 +0000 http://theinvestorsjournal.com/blog/2007/09/01/how-to-avoid-market-corrections-and-crashes/#comment-432 J. D. is correct. Market timing is very difficult to execute consistently. That is because bubbles can last for a very long time as the " greater fool theory plays out". In 1999 the NASDAQ was extremely overvalued by most fundemental measures -P/E, dvidend yield, P/S etc.- THe late investing ledgend Larry Tisch started shorting the NASDAQ at these crazy levels and the NASDAQ proceeded to double costing him billions. Mania can be difficult to understand and predict. Most vetran investors regard market timing as a fool's game. By the way I believe Mr. Tisch continued his strategy of shorting the NASDAQ well into 2000 and recovered his money and then some after the crash. Have to admire his nerve. J. D. is correct. Market timing is very difficult to execute consistently. That is because bubbles can last for a very long time as the ” greater fool theory plays out”. In 1999 the NASDAQ was extremely overvalued by most fundemental measures -P/E, dvidend yield, P/S etc.- THe late investing ledgend Larry Tisch started shorting the NASDAQ at these crazy levels and the NASDAQ proceeded to double costing him billions. Mania can be difficult to understand and predict. Most vetran investors regard market timing as a fool’s game. By the way I believe Mr. Tisch continued his strategy of shorting the NASDAQ well into 2000 and recovered his money and then some after the crash. Have to admire his nerve.

]]> http://www.theinvestorsjournal.com/how-to-avoid-market-corrections-and-crashes/comment-page-1/#comment-430 J.D. Fournier Sun, 13 Jan 2008 01:45:18 +0000 http://theinvestorsjournal.com/blog/2007/09/01/how-to-avoid-market-corrections-and-crashes/#comment-430 It can be quite difficult to move in and out of the market successfully over the long term. It looks like you did pretty well this year, but your selection of stocks, or asset allocation, probably had more to do with it, since it looks like you were successful in picking some high flyers like Apple. In general, market timers will be late to leave and late to return, especially when using technical indicators like moving averages. On the other hand, jumping the gun in or out of the market can hurt your return, as you end up untintentionally buy highing and selling low. Of course, the transaction costs of making the moves erodes your return, not to mention the tax consequences, if in a taxable account (short term capital gains). I don't have the data on the top of my head, but studies have shown the best performing mutual funds are more due to allocation and not timing. Not trying to criticize your approach because it has worked for you so far and I will be interested to follow your progress, and hopefully success, as you navigate through the current volatility. It can be quite difficult to move in and out of the market successfully over the long term. It looks like you did pretty well this year, but your selection of stocks, or asset allocation, probably had more to do with it, since it looks like you were successful in picking some high flyers like Apple. In general, market timers will be late to leave and late to return, especially when using technical indicators like moving averages. On the other hand, jumping the gun in or out of the market can hurt your return, as you end up untintentionally buy highing and selling low. Of course, the transaction costs of making the moves erodes your return, not to mention the tax consequences, if in a taxable account (short term capital gains). I don’t have the data on the top of my head, but studies have shown the best performing mutual funds are more due to allocation and not timing. Not trying to criticize your approach because it has worked for you so far and I will be interested to follow your progress, and hopefully success, as you navigate through the current volatility.

]]> http://www.theinvestorsjournal.com/how-to-avoid-market-corrections-and-crashes/comment-page-1/#comment-13 Adam Fri, 14 Sep 2007 07:23:12 +0000 http://theinvestorsjournal.com/blog/2007/09/01/how-to-avoid-market-corrections-and-crashes/#comment-13 Ah, good point. You definitely need to lower your risk factor when you are nearing retirement. Ah, good point. You definitely need to lower your risk factor when you are nearing retirement.

]]> http://www.theinvestorsjournal.com/how-to-avoid-market-corrections-and-crashes/comment-page-1/#comment-12 Cameron Wed, 12 Sep 2007 20:53:00 +0000 http://theinvestorsjournal.com/blog/2007/09/01/how-to-avoid-market-corrections-and-crashes/#comment-12 I am approaching retirement and another choice this year became "move more into cash and wait for a point to re-allocate" I am approaching retirement and another choice this year became “move more into cash and wait for a point to re-allocate”

]]> http://www.theinvestorsjournal.com/how-to-avoid-market-corrections-and-crashes/comment-page-1/#comment-8 The Stock Market Carnival - Sep 10, 2007 Edition Mon, 10 Sep 2007 06:10:16 +0000 http://theinvestorsjournal.com/blog/2007/09/01/how-to-avoid-market-corrections-and-crashes/#comment-8 [...] the Investor presents How to Avoid Market Corrections and Crashes posted at The Investor’s Journal, saying, “Read this article and learn my proven [...] [...] the Investor presents How to Avoid Market Corrections and Crashes posted at The Investor’s Journal, saying, “Read this article and learn my proven [...]

]]> http://www.theinvestorsjournal.com/how-to-avoid-market-corrections-and-crashes/comment-page-1/#comment-7 » Blog Archive » Festival of Stocks #53 Mon, 10 Sep 2007 02:46:26 +0000 http://theinvestorsjournal.com/blog/2007/09/01/how-to-avoid-market-corrections-and-crashes/#comment-7 [...] the Investor looks at some of the many ways to identify a coming market correction or crash and how he is positioning his portfolio given the data on [...] [...] the Investor looks at some of the many ways to identify a coming market correction or crash and how he is positioning his portfolio given the data on [...]

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