An extended bear market can test everybody's patience and unsettle the most experienced investors.
Small bears were easier to handle than the big (extended) bears of 1929 and 1973 - 74.
No matter how good you are at picking stocks, your stocks will go down, and just when you think the bottom has been reached, they will go down some more. If you own stock mutual funds, you won't do much better, because the mutual funds will go down as well. Their fate is tied to the fate of the stocks they own.
1929: People who bought stocks at the high point in 1929 (this was a small group, fortunately) had to wait 25 years to break even on the prices. Imagine your stocks being in the red for a quarter-century!
1973-74: From the high point in 1969 before the crash of 1973-74, it took 12 years to break even.
Perhaps we'll never see another bear market as severe as the one in 1929 - that one was prolonged by the Depression. But we cannot ignore the possibility of another bear of the 1973-74 variety, when stock prices are down long enough for a generation of children to get through elementary, junior high and high school.
Investors can't avoid corrections and bear markets any more than northerners can avoid snowstorms.
Showing posts with label extended bear market. Show all posts
Showing posts with label extended bear market. Show all posts
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