Showing posts from January, 2010

Investing in Uncertain Times - Part 1

On December 31 1999 the Dow Jones Industrial Average closed at 11,476 points and then progressed steadily upwards till October 2007 where it peaked at an all time high of 14,164. From that point it fell to a low of 6,594 (-53%) in March 2009 before recovering to end 2009 at 10,428 points. Still 26% below where it was ten years prior. If you were a buy and hold investor you would have watched a healthy capital gain evaporate after seven years of growth followed by 3 years of decline. For the average investor this decline has been gut wrenching, to the point where their investment portfolio is now valued at less than what is was 10 years prior. What is even worse is that if you were planning to retire in the next 2 to 3 years you would be now looking at either postponing your retirement or being resigned to the fact of retiring on a much lower income than previously planned. So the magic question is….. Given these uncertain and turbulent economic times, what should an investor invest