I don’t watch the news or the markets, so I was surprised to find out how far the market has fallen lately. Take a look at this…
(Chart of SPX for past year grabbed from BigCharts.)
That’s painful just to look at. Looks a lot like the story of the turkey and the axe.
That’s a roughly 17% drop in 10 days. That wipes out all the gains since mid-September…10 and a half months ago.
A 10 day loss takes out 10 1/2 months of gains.
What if you were 10 days away from retiring? I suppose you would have reallocated or something to try to get away from that volatility, but still, I’m guessing you’ve got another year of work now, instead of a couple weeks.
Even worse than that, investors that bought stocks back in 1998 are pretty much at even.
13 years of seesaw investing, and they don’t have anything to show for it…except maybe an ulcer.
And I guess even worse than that are the investors that invested at the highs of 2000.
11 years of investing and they’ve only got 75% of their money left.
Pretty painful when they probably expected to get some where between 6-8% per year.
At that rate, they should have been up about 90-130%, but instead are down 25%.
I guess the upside is that the 25% might come back in a year…before it’s all lost in a couple weeks again.
I realize this is a tragedy for a lot of investors, and that they’re all glued to every news report even tangentially related to this, trying desperately to figure out what their next move should be. (I know because I used to be that investor…)
But for those of us using the No Lose Stocks strategy, this is just an interesting event. Something to glance at once, and then get back to enjoying life.