I think you know the answer and its frustrating, depending on your portfolio...Because your value hunting, bottom fishing and right now the market aint rewarding that, at all. The russel 2k is at a 52 week low and if you dont own GE, LU, MRK , PFE, etc. you arent participaing, stressing the importance of allocation and diversification Right now, i'd be about 30% large caps, 30% smaller/mid caps, 40%cash..and the 30% in large caps, while most exposed to a harsh correctio, iss critical because it appears the markets will continue to reward liquidity and brand name. It might never change...these small caps and mid caps might fall right off the horizon.. some might go bankrupt, some taken over at such valuations, some taken back private by the companies, etc...if buyers dont want you, regardless of earnings, you're going lower...keeping that in mind and the fact that stocks go to zero, longer term, value oriented, bottom fishing has outperformed large cap investing...not in the 1996 to 1998 period but over the 1977 to 1998 period, it has outperformed.
Regards,
Steve |
