SI
SI
discoversearch

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor.  We ask that you disable ad blocking while on Silicon Investor in the best interests of our community.  If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.
Strategies & Market Trends : Investing for the Long Run
 Public ReplyPrvt ReplyMark as Last ReadFilePrevious 10Next 10PreviousNext  
From: tyc:>6/27/2007 8:03:27 PM
   of 68
 
Stock market risk;

Here's a memo wrote to myself a couple of years ago, as a permanent reminder reminder of RISK.

"My attitude to stock market investments reflects my confidence that the average annual return of stocks has historically been greater than any other asset class.

But I had my doubts when I read (in The (Mis)behaviour of markets), ".....they assume that the "average" stock market profit means something to a real person; in fact, it is the extremes of profit and loss that matter most. Just one out-of-the-average year of losing more than a third of capital- as happened with many stocks in 2002- would justifiably scare even the boldest investors away for a long while".

EOQ

That gives me pause ! But, in a sense, that is the very core of my investment strategy. A person's capital need not be measured in dollars. My aim and objective is to grow the S&P500 value of my investments (as explained). Dollar value is irrelevant to it....just as irrelevant to me as S&P500 value is to a person invested in cash. Would he feel he had lost capital by being out of the market when it advances ? Of course he doesn't. For similar reason I think I could emotionally handle a SPIKE in the relative value of cash.... Indeed, I find myself daily enjoying a fall in S&P500 price for that is the divisor.

Moreover, it wasn't the 2002 fall that caused the damage (IMHO) but the preceding bubble which was avoidable, and would be avoided by my trading strategies.

I suppose that is what my blog (this thread) is all about.
Report TOU ViolationShare This Post
 Public ReplyPrvt ReplyMark as Last ReadFilePrevious 10Next 10PreviousNext  

HomeMailHotSubjectMarksPeopleMarksKeepersSettings
Terms Of UseContact UsCopyright/IP PolicyPrivacy PolicyAbout UsFAQAdvertise on SI
© 2026 Knight Sac Media.  Data provided by Twelve Data, Alpha Vantage, and CityFALCON News