Saturday, October 25, 2014 03:05am
North Adams, MA now: 37 °   
Send news, tips, press releases and questions to info@iBerkshires.com
The Berkshires online guide to events, news and Berkshire County community information.
SIGN IN | REGISTER NOW   

Home About Archives RSS Feed
@theMarket: No Spring in the Stock Market
By Bill Schmick On: 06:46AM / Saturday April 12, 2014
Important
0
Interesting
0
Funny
0
Awesome
0
Infuriating
0
Ridiculous
0

As spring finally arrives throughout the country, you would think the stock market would celebrate, but not this year. The indexes were slammed again this week and we can expect more of the same in the months ahead.

By now, if you have been following my advice, you have already raised some cash by selling your most aggressive equity holdings. How much cash you hold is up to you. However, before you sell more, remember, that this sell-off is only a temporary state of affairs. By the fall, you want to be fully invested once again.

In the meantime, don't expect the stock market to simply drop like a stone. What I expect is a series of lower highs and lower lows. That process is beginning to unfold right now. So far this week, we have about a 3 percent decline in the S&P 500 Index. The tech-heavy NASDAQ has had a far greater decline, dropping that much in a day.

Momentum and biotech stocks have been the name of the game since the beginning of the year. While the overall markets simply vacillated up and down over the last three months, those stocks were winners with some names gaining 30-50 percent. Most of those companies are traded on the NASDAQ. Now that the markets are pulling back, it is those same stocks which are leading us lower.

When I first warned investors of a coming sell-off, I mentioned the over-heated initial public offering market (IPO) as one clear early-warning sign that the markets had risk. I noticed that this week, which was billed as the busiest public offering week since 2007, actually flopped.

Only three out of seven new companies actually made it to market, while the others postponed due to market conditions.

By now, most of my readers (and clients) have become accustomed to volatile markets.

Many of you lived through the devastating declines in 2008-2009. We endured together several major declines together since then. We suffered through periods when the markets were going up and down 1 percent or more per day, so what we face this spring and summer should be small potatoes to you.

Those trials and tribulations have seasoned you. As veteran investors, you can live through this decline. You realize that this too shall pass. The key in the months ahead is to maintain your composure, resist making emotional decisions and, if you still have not raised some cash, I want you to do so as the market once again climbs to (and possibly breaks) the old highs.

My suggestions would be to sell small or mid-cap stocks or funds. Large cap growth funds are also a good idea, but resist the urge to just sell everything. Markets can be a quirky lot. The past has taught us that stocks can turn on a dime and if you don’t have skin in the game when they turn, you stand to lose quite a bit.

Sure, I'm looking for a 10-15 percent  decline, but what if stocks reverse and go higher before that? In October  2011, the stock market gained 9 percent in just seven business days. By the time some investors got the courage to get back in the markets had erased almost half their decline.

That's why you play the percentages when investing.

Bill Schmick is registered as an investment adviser representative with Berkshire Money Management. Bill’s forecasts and opinions are purely his own. None of the information presented here should be construed as an endorsement of BMM or a solicitation to become a client of BMM. Direct inquires to Bill at 1-888-232-6072 (toll free) or email him at Bill@afewdollarsmore.com.



0 Comments
     
News Headlines
Mount Greylock Debates Lanesborough School Union Vote
Adams Narrowing Down Town Administrator Applicants
North Adams Happenings: Oct. 21-28
Cultural Pittsfield This Week: Oct. 24-30
Atlas Private Wealth Management Moving to North Adams
Lanesborough Officials Debate School Spending
Adams Seeks Fix to Visitors Center's Ineffective Geothermal System
Mount Greylock Committee Taking Up Delayed Superintendent Search
North Adams to Williamstown Bike Path Public Meeting Set
Pittsfield Schools Review Teacher Evaluation Process

Bill Schmick is registered as an investment advisor representative and portfolio manager with Berkshire Money Management (BMM), managing over $200 million for investors in the Berkshires. Bill’s forecasts and opinions are purely his own and do not necessarily represent the views of BMM. None of his commentary is or should be considered investment advice. Anyone seeking individualized investment advice should contact a qualified investment adviser. None of the information presented in this article is intended to be and should not be construed as an endorsement of BMM or a solicitation to become a client of BMM. The reader should not assume that any strategies, or specific investments discussed are employed, bought, sold or held by BMM. Direct your inquiries to Bill at 1-888-232-6072 (toll free) or email him at Bill@afewdollarsmore.com Visit www.afewdollarsmore.com for more of Bill’s insights.

 

 

 



Categories:
@theMarket (149)
Independent Investor (201)
Archives:
October 2014 (8)
October 2013 (1)
September 2014 (5)
August 2014 (7)
July 2014 (2)
June 2014 (6)
May 2014 (9)
April 2014 (8)
March 2014 (6)
February 2014 (6)
January 2014 (7)
December 2013 (8)
November 2013 (7)
Tags:
Interest Rates Jobs Stimulus Greece Congress Housing Fiscal Cliff Metals Debt Ceiling Federal Reserve Currency Economy Markets Banks Europe Bailout Stocks Crisis Stock Market Japan Pullback Rally Retirement Energy Deficit Europe Debt Fed Commodities Euro Selloff Taxes Oil Recession Election
Popular Entries:
The Independent Investor: Understanding the Foreclosure Scandal
The Independent Investor: Don't Fight the Fed
The Independent Investor: Does Cash Mean Currencies?
@theMarket: QE II Supports the Markets
@theMarket: Markets Are Going Higher
The Independent Investor: General Motors — Back to the Future
The Independent Investor: How Will Wall Street II Play on Main Street?
The Independent Investor: Will the Municipal Bond Massacre Continue?
@theMarket: Economy Sputters, Stocks Stutter
The Independent Investor: Why Are Interest Rates Rising?
Recent Entries:
@theMarket: All Clear
The Independent Investor: The Elephant in the Room
@theMarket: So far, So Good
The Independent Investor: OPEC's Oil Ploy
@theMarket: Are We There Yet?
The Independent Investor: Why Is This Recovery Different?
@theMarket: October Starts Off on High Note
The Independent Investor: Money & Divorce — What You Should Know
@theMarket: Wash, Rinse and Repeat
The Independent Investor: Is Wall Street Responsible for Climate Change?


View All
Soccer: Wahconah vs Lenox
Collin Parrott scored three times on Tuesday to lead the...
Girls Soccer: Wahconah vs...
Rachel Donahue scored with four minutes left to give the...
Football: Hoosac Valley vs...
Koperniak made the last play of the night, a 1-yard plunge...
Boys and Girls Cross Country
Boys and Girls Cross Country was held at Windsor Lake on...
Western Mass Golf
Four Berkshire County golfers qualified for the state...
Football: Franklin Tech vs...
McCann Tech holds on for the win Saturday afternoon. McCann...
Colegrove Park Elementary...
Mayor Richard Alcombright and the City Council were updated...
Boys and Girls Cross Country
Berkshire Chamber Greylock
Boys and Girls Cross Country
The Lenox boys and girls teams both cleaned up on Senior...
Volleyball: St. Joe s vs...
Taconic takes 3 from St. Joseph Tuesday night.
Ramblefest 2014
Adams residents enjoyed entertainment, food, and locally...
Girls Soccer: Hoosac Valley...
The Wahconah girls soccer team on Monday advanced to an...
Berkshire County Classic Golf
Francois Benistand, an exchange student from the south of...
Indashio Fashion Show
Fashion designer Indashio holds his second FAME Festival in...
Football: Pittsfield vs...
Senior quarterback Nick Clayton marched his team 80 yards...
Soccer: Wahconah vs Lenox
Collin Parrott scored three times on Tuesday to lead the...
Girls Soccer: Wahconah vs...
Rachel Donahue scored with four minutes left to give the...
Football: Hoosac Valley vs...
Koperniak made the last play of the night, a 1-yard plunge...
Boys and Girls Cross Country
Boys and Girls Cross Country was held at Windsor Lake on...
Western Mass Golf
Four Berkshire County golfers qualified for the state...
| Home | A & E | Business | Community News | Dining | Real Estate | Schools | Sports & Outdoors | Berkshires Weather | Weddings
Advertise | Recommend This Page | Help Contact Us | Privacy Policy| User Agreement
iBerkshires.com is owned and operated by: Boxcar Media 102 Main Street, North Adams, MA 01247 -- T. 413-663-3384 F.413-664-4251
© 2000 Boxcar Media LLC - All rights reserved