Complacency Indexes Message Board

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Strategies & Market Trends : Complacency Indexes

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To: TechTrader42 who started this subject	3/13/2002 10:14:56 AM
From: William JH	Read Replies (1) of 1487

A most ingenious paradox: If the public is bullish, that's bearish. But somehow, the market is supposed to be predicting the future. It's all so confusing. A take on complacency from "Market Rap." "Lastly, if the risk-free rate in this country -- the T-Bill rate -- is something less than 2%, does it stand to reason that the risk-free rate from stocks should be 10%? No. Stocks have risk. And, as I mentioned, there are ways to lose money in equities over time. People have completely disregarded risk as an element within the equation, which is why I keep harping about the price you pay for the asset. That's how you reduce the risk. If you systematically and consistently overpay for assets, you will lose money over time, guaranteed."

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