Daily Mixup

A 900% Return on Your Investments (environmental news)

By Justin Lukasavige

 With all of the economic news lately, many investors are pulling out of the stock market. I have personally seen clients that are in bad investments anyways and thus do need to take a close look at their allocations. Many of these same clients should have done this months, and even years, ago because their investments simply have not been a good fit for them.

Is the current market scaring you? The closer you are to retirement usually plays in to your level of emotion right now. Many people are panicking and selling their investments to limit their exposure to the stock market. Where many people have become affected by fear, I see opportunity. In fact, so does the most successful investor of all time, Warren Buffet, who has thought the stock market over-priced for the past few years. Now that it is on sale however, Warren has been buying stocks like crazy.

Many of us are familiar with the crashes of 1929 (The Great Depression) and even the crash of 1987 where the market fell over 20% in a single day. What about the other crashes during the late and early 1970s? What about the slumps of 1962 and even 1946? Most of us have also forgotten about the downturn during 2000 2003.

While many investors are fleeing, I prefer to look at what has happened throughout history before I make any rash judgments. For instance, during The Great Depression, stock prices fell about 90%. Investors that saw opportunity and invested during that time easily doubled their money over the next 20 years.

Investors that saw opportunity after Black Friday in 1987 were able to earn a 900% rate of return in the next twenty years after the stock market recouped! If you follow that math, that time period also includes the downturn that happened between 2000 -2003.

When investing your money, do not be tempted to follow the crowd. Keep your cool and maintain a bit a common sense.

For more information, check out this article by the Wall Street Journal.

Justin Visit www.lukascoaching.com/resources.htm

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Monday, October 27th, 2008 at 9:45 am and is filed under news. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.