Beating the Bear Market: Plan for Long-Term Investing
January 16, 2008 by Miranda Marquit
Filed under Finance
We’re heading into a recession in the U.S. economy, and a bear market is coming in terms of stock investing. I’ve been posting advice from Paul Farrell’s article on MarketWatch, “Ten resolutions that will help you survive the coming bear market.” All sorts of words of wisdom about practical investing in these perilous economic times. Today’s chosen extract is this:
Nobody can time the market. Remember, about 75% of all managers fail to beat their benchmarks. They want you to play the market because they get rich from your trading fees and commissions. If you have an itch to gamble, go to Las Vegas or buy a lottery ticket — the odds are higher and so is the entertainment value.
Long-term investing is key in these times. While you might get lucky and hit on something with some short-term trades, chances are that you will lose money on such schemes. Instead, find some bargain-priced, yet solid, stocks that are having trouble right now. Then prepare to hold to them through the current downcycle. Over the long run, the stock market usually comes out ahead.
Other posts in this series:
I did an investment study once, comparing investments in paintings and stocks. The investments in paintings of Philippine Masters had steeper growth rates than the bluest of the blue chips in the Philippine Stock Exchange. This might also be the case in the United States.
This is very interesting. I think that looking at trends in other countries can be very helpful. I really haven’t thought much about art as an investment…