We all enjoy playing a game we can’t lose but investing in the stock market is not one of them. However the promise of “guaranteed returns” led shell-shocked investors to pour nearly $30 billion into index annuities in 2009 even as they pulled $9 billion out of U.S. stock funds.
If buying low and selling high is the secret to investing success should you buy every time the market drops significantly?
With Paranormal Activity 3 setting records at the box office it’s a good time to talk about how fear can impede sound investment decisions. Certainly the acute market volatility we’ve experienced over the last few years has sparked a growing fear among investors of incurring additional losses. How does this attitude impact your portfolio?
Many investors believe step one in dialing down their portfolio’s risk should be reducing equity exposure. Yes stocks are riskier than bonds but that’s an oversimplification that can result in some misguided moves.