What a joke

My Advanced Financial Management professor and the rest of the world think that stock markets today are "riskier" due to higher "volatility", which incidentally is created by the market itself. I don't understand how it is "riskier" to buy stocks at prices 50% lower than the prices you paid for them when you supposedly thought they were "less risky", even though you paid twice the amount. Absolute crap

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Pretzel · 61-69, M

there will bue some dramatic ups and downs for the next 6-12 months.

with people dying in large numbers over the next couple of weeks in the US I can see it dropping futher.

reminds me of the old saying

buy low
sell high

Nomad7 · 22-25, M

@Pretzel That may seem like a good idea, but it requires a lot of emotional control because you'll be doing the exact opposite of what millions of others are. Many times too, you'll regret that you bought something if the price falls further or that you sold it when its price goes up. Unless you really understand business valuations and fundamental analysis, it's best to stick to Index funds that have very low management fees and commissions. Or buy the largest companies that you know are strongly financed, low debt and are not too expensive in relation to earnings, assets, dividend and cash flows. Never lose money

Pretzel · 61-69, M

@Nomad7 If I were buying stock right now it would be in amazon, walmart, PPE manufacturers, and hospitals.

Insurance companies will take a hit worse than a massive hurricane - and I imagine it will stress them.

and like any investment it would be for the long term - I expect the markets to go down until the death/infection rate turns the corner

when people go back to work the economy will start a slow recovery

LamontCranston · M

@Nomad7 You are wise beyond your years, Bames.
My only issue is with respect to index funds. Becuase most are cap-weighted, they take an inordinate hit in a declining market when the nervous nellies sell.

Nomad7 · 22-25, M

@LamontCranston That's true with most funds, though. But there are several added advantages over mutual funds. Firstly, index funds have minimal management fees, which means they perform exactly as the market. It's a universal truth that mutual funds underperform the market over the long term by the amount of their management fees. Also, they don't buy a select few overpriced giants like mutual funds, who have to due the hundreds of millions of dollars under management; index funds by the index proportionately. Another advantage is that they do not specialize- so there are no tantrums with the "small-cap", "large cap", "tech stocks only". Buying an index fund means you buy the market at all levels. And this has shown to be a good strategy over the long run. It's an excellent choice for a passive, defensive investor, who simply wants little hassle and a satisfactory return

LamontCranston · M

@Nomad7 my only disagreement with You is a S&P 500 index like SPY which has huge holdings in the mega caps like Amazon. RSP is equal weighted and my "gurus" recommend it as an alternative.