John, just sniffin around the edges!gg
Will go to the store on Monday probably and do the big shopping.gggg
I just responded to a post over on stock attack II, where the guy posted an article out of the venerable Washington Post. Alleged "market experts" said "not to panic"!
I say WHY NOT? Panic if you want to! How much of your 401K do you have to loose before you say enough is enough?
Percentages =% are funny things. For instance Fidelity Magellan on 12/30/99 was at $136.63 a share. Today it closed at 107.84, a decline/drop/loss of 21%. Not bad, just hold on and it'll go back up you say. Yeah, right, but now it has to go up 26.6% to get back up to $136.63!
But wait, it gets worse! Let's just say it goes down to $50 a share, or a drop of 63%. You say, not too bad just hold on and stay the course. Well now at $50 a share FMAGX would have to increase by 172% just to get back up to the close on 12/30/99. Pretty insidious hugh? Sometimes, sometimes, SOMETIMES its difficult to make 172% ROI! Especially after the market takes a big hit and investors are scarce.....
Now let's talk time. If we see a drop to say $50 a share this year, which I admit is remote but possible, how long would it take to make up the 63% drop (172% back up) at say an average of 17% per year? (bear in mind that the lower the market goes the lower expectations with respect to percent of ROI goes, and the 17% might be 5 or 6 gggg) Well it aint 10 because of the compounding effect, but it is 6.3 years. So one could surmize that it could take 2 to go down and 6 to go back up! barf!
Lets hear it for the "buy and holders" and DON'T PANIC, stay the course!
I always wondered why the market goes down faster than it goes up. Gosh, wonder how long it would take JDSU to get back up to $153.00 from the present value of $11.31? (the answer will appear on the back of the next box of Cheerios)gg
One man's perspective, we will entertain other expert opinions! ggg
CU
Paul K. (caveat: these #s may not be accurate, I'm an engineer, but T Berney/Swamp Fox put me on to this) |
