On 2009-01-12 12:47:46 -0800, "HW \"Skip\" Weldon"
<skip5700removethis[at]yahoo.com> said:

- quote -

For sure, I have noticed that people are ready to think of "the long
term" as 5 years when the market is rising and 10 years or more when
the market is low. Perhaps you could say that a "volatile" stock or
fund is risky" for someone who is focused on the short term, oriented
toward getting rich quick, etc, or prone to buy or sell impulsively.
For someone who is disciplined and not constantly worried about
short-term movements, many highly volatile stocks or funds with large
up and down movements can do very well over a period of many years. You
might say that a large part of "risk" is contained in the attitude of
the person who is doing the investing.

On Sat, 10 Jan 2009 15:15:12 -0600, Don <dwzimm[at]telus.net> wrote:


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Don this really doesn't apply to your post - rather, your well-done
post triggered some thoughts.

Has anyone else noticed that the consensus definition of "long-term"
varies with the stage of the economic cycle? By that I mean that
during expansions the definition shortens to less than 10 years, while
during contractions it lengthens to well beyond 10 years with both
definitions heavily influenced by current market conditions.
Permitting current market conditions to influence or define long-term
strategy is something I've found unwise.

On a related subject, my opinion is that some people use the word
"risky" when the appropriate term should be "volatile". Assuming we
are talking of a diversified, low-cost investment, I prefer "volatile"
because it corresponds with my observation that while a diversified
account will be volatile in the near term, the longer term trend has
been consistently positive. Therefore a diversified investment is
only "risky" if the investor sells at the wrong time - so the
appropriate strategy would not be to avoid or get out of stocks, but
to hold stocks while building a cash fund that could be accessed if
necessary during "down" markets.

Bottom line: It's a cash fund that reduces "risk" to mere
"volatility".






-HW "Skip" Weldon
Columbia, SC

On 2009-01-10 11:03:44 -0800, "Steven L." <sdlitvin[at]earthlink.net> said:

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In the light of these findings, the often-heard advice that people can
expect good returns in stocks over the long term should be taken with
caution. It woud seem that "the long term" has to be at least 20 years,
if not 30. Holding for only 10 years would seem to be quite risky.

Douglas Johnson wrote:
- quote -

It's a bull market within long-term secular bear market conditions.
Notice how the previous bull market (2003-2007) only reached about as
high as the previous 2000 peak--and then it collapsed before our eyes.

The current bull market hasn't a chance of exceeding the previous two
market peaks.

Growth Fund Guide did a study of previous bull markets within long-term
secular-bear conditions (such as the 1968-1982 period), and found that
the average rise was about 48%.

Such a rise (up to about 1100 on the S&P 500) would still leave the S&P
500 down 27% below its peak in early 2000. Even a 70% rise off 741
would leave the S&P some 18% below it's peak in early 2000.

So anyone who invested in the stock market in the late 1990s and held on
for all this time would still have taken a sizable loss.


--
Steven L.
Email: sdlitvin[at]earthlinkNOSPAM.net
Remove the NOSPAM before replying to me.

We saw a suckers rally from March to May in 2008, so there are no
guarantees.

Interestingly, the American dollar seem to have broken out from the
trading range and is now weakening quite quickly. For many years the
American dollar has been in decline but late in 2008 it rose sharply
possibly due to investors selling off risky assets and paying off
margin loans denominated in US dollars. Once the de-levering stops,
perhaps the US dollar will continue its decline.

Will Trice <me[at]invalid.com> wrote:


- quote -

"How I made a lucky call that wasn't quite as lucky as the guy who called it a
day earlier. Both of whom are patting themselves on the back way too early"?

Naw. Too long. -- Doug

Douglas Johnson wrote:
- quote -

You mean in *my* book.

-Will

P.S. I'm taking suggestions for a title...

william dot trice at ngc dot com

On 2009-01-07, Douglas Johnson <post[at]classtech.com> wrote:
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I would prefer that it did not start so early.

--
Due to extreme spam originating from Google Groups, and their inattention
to spammers, I and many others block all articles originating
from Google Groups. If you want your postings to be seen by
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posting on Usenet.
http://improve-usenet.org/

Douglas Johnson wrote:
- quote -

And excluding dividends, US small-caps are up about +34%, equity REITs
almost +50%, since that day, based on the Russell 2000 and DJ Real
Estate index respectively. Large international stocks per the MSCI-EAFE
index are at about +24%, partly lower due to a dollar gain, but their
yield has been a bit higher.

That's in 46 days.

-Tad

The S&P 500 hit a low of 741 on November 21st. As of today's close it was
934.7. That's up over 25%, a bull market in anybody's book. -- Doug