The "buy and hold theory" has just been given an extra kick while it was unconscious and bleeding to death. I've seen portfolios cut in 1/3 in the last 2 months. Once in a while a stock wanders out of the list and might be up, even double, but that is the exception rather than the rule. I have some option positions and 3 small stock positions in biotechs which won't be earning anyhow but their pipeline is still overflowing. Energy stocks remained a mainstay throughout these last 6 weeks as have some generic drugs stocks, major drugs stocks etc. Even BVSN and a few others were good for 25% gain in the last 6 weeks. Anyone making that much on average consider yourself very lucky and to have bucked the downtrend of the major averages. Anyone saying that traders have not had the major edge in the last 6 weeks are just living in a world of denial and oblivion, probably egged on by the constant 'all is well' drone of analysts at major brokerages in mortal fear of their own jobs. Of course the government has done very well. Capital gains taxes have been on the rise by fourfold and traders gains have been passed on to them.
Those who have had the luck or 'dream' to have made 1-200% in the last 6 weeks, autographs should be available on ebay site shortly.
Traders have made out better than investors, unless you average down the last 3 years and lop off the last 3 months. But then most of us have longer term portfolios even up to 10 years and I still stay the buy and hold theory is dead. You can't keep averaging down and looking at the bull markets 1996-january 2000 and assume things will continue that way indefinitely. Those who haven't taken profits, the profits were totally and ignomiously eaten.
Who is going to be making money in the next few weeks and months? Again the traders with large cash reserves waiting on the sidelines until the stock have gone down even more as individual investors have 'loaded up' last week thinking the bottom was reached. Shorters who may still find some upticks or at least get puts in some of the 'newest' blimps like NEWP, PWAV, RMBS, TXN, CHKP, SDLI, AETH, TERN, AMCC, ETEK, BRCM, etc. |
