How are you invested ??

Just because it’s a bull for three months doesn’t mean it’s not an irrational bull.

A bear only needs to be right once a decade to make money. 2000 and 2008 make us two for last eight. If we can batt .300 by getting 2009 in the win column, to paraphrase David Winfield; baseball, and being a bear, is the only job where you can fail 7 out of 10 times and still make million

What perma bull made money from 1998 to 2008 with a buy and hold strategy ?? NONE.

Bears don’t make 50% in six months like the S&P, but they don’t lose 40% in that time either. Any math with tell you that losing 40% (S&P actually lost 57%) leave a million dollars down to $600,000 so followed by a gain of 50% (S&P currently up 55% from low), leaves you at $900,000 down $100,000.

Not so for a realistic and hedged bear over the last 12-16 months.  For the prudent bear the returns are much better, say  down 10% then up 20% (rather -40% than +50%). This takes the million down to $900,000 then back up to $108,000. Sure you only made $8,000 (8%) but that crushes the loss perma-bulls endured.

Look at any long term S&P charts and the evidence is clear.

Bulls should acknowledge and apologize for the last, going on eleven, years of BEAR market fact. The same people who were shouting bull were shooting bull. And they still are.

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One response to “How are you invested ??

  1. Awesome blog!

    I thought about starting my own blog too but I’m just too lazy so, I guess Ill just have to keep checking yours out.
    LOL,

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