As simple as “buy low, sell high” sounds, events and sentiments seem to conspire to get us to do just the opposite. Stocks are cheaper than they have been for a long time. The S&P 500 index, currently at 930 points needs to climb 18% to reach the closing price of October 30, 1998. Yet, as high as stock valuations were in 1998, people were generally very eager to buy stocks then, just as people cannot seem to get rid of stocks, or any risky assets, quickly enough now. Given the uncertainties ahead it is understandable that many investors are waiting to see clear signs of a bottom — there is nothing to keep cheap stocks from getting cheaper. However, bottoms are only visible in hindsight. For those who are fortunate enough to have some cash on the sidelines, there are some enticing opportunities for deployment. Read the rest of this entry »
Posted by Arnbjorn Ingimundarson 
