Market Musings 10 8 2008

I have not communicated for along time.
One of the reason, I gave up writing was lack of feedback from you all...

As I write this, I am sure that most of us are unhappy with the market and our investments.
But, misery loves company....

Here are what the best mutual fund managers are doing:
(Taken from IBD 10 8 2008)
Fidelity Contra: -32%
Janus 20 : -38%
Brandywine : -38%
Legg Mason OP : -51%

I do not have to tell you, we are experiencing a full fledged bear market.

S&P 500 is down 28.27%.
Nasdaq QQQQ is down 31.94%.
Russell 2000 is down 21.34%.
Semiconductor Sector ETF SMH is down 30.87%
Financial Sector XLS is down 37.78%.

Here are some comments...

A) Compare your portfolio performance with above numbers and see how you did.

B) Best mutual funds that have billion of dollars are doing worse than S&P 500 index, a bench mark that is used by most people to judge performance index.

So, investing in Mutual Funds with buy and hold principal is not very productive for any body. One could say, market is too complicated. And, it is. But you all should learn basic essentials and how much, the stocks anticipate the future changes in economy.

But, my reliable sources in the financial business indicate that most of the blood letting is over. But, they are short term oriented. And, that is just not possible with most of us.

So, hang in there, the end of the bear market is near. We will have to overcome fear to purchase the remaining financial stocks, that survive. That seems like the most difficult thing to do.

Using XLF, an ETF in financial sector is a good choice.

But, I expect some more terrible days in the market....