Here's a statement of the obvious: The opinions expressed here are those of the participants, not those of the Mutual Fund Observer. We cannot vouch for the accuracy or appropriateness of any of it, though we do encourage civility and good humor.
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Lesson One, boys and girls. Don't shoot yourself in the foot. (LIP)
Yeah, its weighing how much money it thinks the Fed is going to print over the short term, medium term and long-term.
Many of the retail investors who are gone aren't coming back for years, so the financial media can stop wasting energy trying to scold them. It's nice not having watched CNBC in a couple of months so that I don't hear "WHERE IS THE RETAIL INVESTOR?" over and over and over again. Writing articles like "Main Street's "$100B Stock Market Blunder" (another Smart Money article) is not educating anyone, it's just trying to shame them and scold them, it would seem. It's completely unhelpful. ("Hey, lets write an article and not help anyone who has not participated and instead just write an article not-so-subtly acting like they're morons.")
I think people have to stay globally diversified as a priority and there are ways to bring down volatility (alternative funds, etc.) People have to have some strong belief in their investments - what do you feel strongly about? Someone may have strong feelings or insights on a particular theme. To some degree, there's the Peter Lynch advice of invest in what you know or at least feel strongly about - that's not going to always lead to an investable thesis/outcome, but it's a good place to start for at least a portion of a portfolio.
People also have to be willing to do the homework, and I think people are either unwilling or unable or a million other issues. I find it completely understandable. I think a lot of people are going through a tough period and I think there has to be some degree of understanding and sympathy of that. Articles like this really just go, "You're missing the rally!" There's little insight into the mentality that people have when it comes to investing today and the reasons why people have been taking money out of the market.
Facebook didn't quite see the retail participation that people thought it would, but it still was a terrible experience for a lot of retail investors both in terms of the technical issues and the sheer losses, but it speaks to the lack of financial education in this country when a lot of people probably really like facebook and that is the extent of their research. How many of them know about P/E ratios? It would be great if financial education was a part of high school, but that's extremely unlikely.
Very misleading article, typical of Smart Money (a misnomer is ever here was one). Yes, if you are not invested in equities you have missed the rally over the past two months since the market hit a ST bottom in early June. However, if you look a large number of mutual funds and individual stocks and compare their current prices to what they were when the market peaked in March, most of them have lost value or remained nearly unchanged, with extreme volatility thrown in to create anxiety in the average investor.
Meanwhile, if you are primarily invested in multi-sector bond funds, which have generally avoided or are underweight U.S. Treasury bonds ---- bond funds that offer between 4% to nearly 8% yield, you have steadily grown your portfolio (albeit only 3 to 6%) over this time interval without any need to watch the market.
My point: Smart Money built a straw man by retrospectively selecting the time frame in which you should have been invested in equities, then claims you have "missed the boat" and should aggressively jump back into the market when the indices are near 52-week highs.
Comments
Many of the retail investors who are gone aren't coming back for years, so the financial media can stop wasting energy trying to scold them. It's nice not having watched CNBC in a couple of months so that I don't hear "WHERE IS THE RETAIL INVESTOR?" over and over and over again. Writing articles like "Main Street's "$100B Stock Market Blunder" (another Smart Money article) is not educating anyone, it's just trying to shame them and scold them, it would seem. It's completely unhelpful. ("Hey, lets write an article and not help anyone who has not participated and instead just write an article not-so-subtly acting like they're morons.")
I think people have to stay globally diversified as a priority and there are ways to bring down volatility (alternative funds, etc.) People have to have some strong belief in their investments - what do you feel strongly about? Someone may have strong feelings or insights on a particular theme. To some degree, there's the Peter Lynch advice of invest in what you know or at least feel strongly about - that's not going to always lead to an investable thesis/outcome, but it's a good place to start for at least a portion of a portfolio.
People also have to be willing to do the homework, and I think people are either unwilling or unable or a million other issues. I find it completely understandable. I think a lot of people are going through a tough period and I think there has to be some degree of understanding and sympathy of that. Articles like this really just go, "You're missing the rally!" There's little insight into the mentality that people have when it comes to investing today and the reasons why people have been taking money out of the market.
Facebook didn't quite see the retail participation that people thought it would, but it still was a terrible experience for a lot of retail investors both in terms of the technical issues and the sheer losses, but it speaks to the lack of financial education in this country when a lot of people probably really like facebook and that is the extent of their research. How many of them know about P/E ratios? It would be great if financial education was a part of high school, but that's extremely unlikely.
Meanwhile, if you are primarily invested in multi-sector bond funds, which have generally avoided or are underweight U.S. Treasury bonds ---- bond funds that offer between 4% to nearly 8% yield, you have steadily grown your portfolio (albeit only 3 to 6%) over this time interval without any need to watch the market.
My point: Smart Money built a straw man by retrospectively selecting the time frame in which you should have been invested in equities, then claims you have "missed the boat" and should aggressively jump back into the market when the indices are near 52-week highs.
Not.