By Rob Bennett
Most stock investors enjoy bull markets. I do not. My view is that the added returns that investors see in bull markets are borrowed from the returns that otherwise would come to them in future years - overvaluation is always a temporary phenomenon. So I hate bull markets.
And the irrationality that brings them on. And the bad investing advice that encourages the irrationality. Has there ever been a time when the widespread belief in buy-and-hold strategies did not end in tears? Not yet. Not in the 145 years of stock market history available for review by us today.
Bear markets are just as bad in a different sort of way. Irrational exuberance inevitably leads to irrational depression. The market never loses sight of its primary purpose - to get prices right. When investors become so enthralled with the buy-and-hold "idea" that they are unwilling to listen… Read More …