Thoughts and observations for those investing on their own or contemplating doing it themselves.
If you are seeking investment help, look at the video here on my services. If you are seeking a different approach to managing your assets, you have landed at the right spot. I am a fee-only advisor registered in the State of Maryland, charge less than half the going rate for investment management, and seek to teach individuals how to manage their own assets using low-cost indexed exchange traded funds. Please call or email me if interested in further details. My website is at http://www.rwinvestmentstrategies.com. If you are new to investing, take a look at the "DIY Investor Newbie" posts here by typing "newbie" in the search box above to the left. These take you through the basics of what you need to know in getting started on doing your own investing.
Friday, August 17, 2012
Is This a Good Time to Invest?
Last year was a great case in point. In October, it looked like the world was coming to an end. The U.S. Congress was at an impasse and seemed incapable of increasing the debt limit ceiling. Europe was falling apart, and it appeared obvious that Greece was on the verge of leaving the European Union with Spain close behind and possibly even Italy down the road. Abandonment of the euro and its attendant uncertainty was the buzz of the day. Topping off all of this was economic data suggesting the U.S. may be going back into recession.
With this backdrop, any brilliant, analytical portfolio manager would sell; and, from performance results, it appears they did. Unfortunately (for them!) the market rose sharply through year end. As a result, huge state pension funds produced anemic returns and hedge funds got clobbered. Once again, the brilliant, analytical types were not smarter than the market.
Take A Longer View
There is a different approach. Rather than trying to outguess the market on a short-term basis, take a longer view. This approach recognizes that the world 10 -15 years from now will be wildly different from today. How do we know this? Just compare today with 15 years ago. Look at smart phones and tablets. Tablets of today are the Pong games of yesterday. Look at automobiles and advances in medicine.
Does anyone doubt that the automobiles we drive 15 years from now will be completely different from today's. The laptops and other electronic devices will all be replaced with products beyond our imagination. I know this is hard to grasp for many. Maybe it requires a certain age. Fifteen years from now, people will be saying "Merkel who?" as they project the TV program they recorded three hours ago onto the wall from their smart phone.
I am of a vintage whereby graduate school involved going to the "stacks," getting journals, and xeroxing articles that were months old. Today, students with a laptop have access to the latest research in many areas and the ability, in many cases, to interact with the researchers.
Anyway, to help along these lines, I submit the following video found at Biz of Life's site. As you watch this video, I suggest you free your imagination and think of the possibilities in the so-called "information age."
Posted by Robert Wasilewski at 3:49 PM
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