As of this post, the markets are down by over 1%, on a day where the two safe sectors to own, bonds and Gold, are also down. Of course, the broad market selloff is being led by the financials stocks, when considering the positive news flow of late, they shouldn't be. Despite the down day and the ugly action in the financial sector, I'm still sticking with my 2012 forecast that the financial stocks need to be owned as we see the economy continue to pickup. The few stocks that are up today are the dividend stocks, such as Verizon, AT&T, a few utility companies, and high yielding REITS (Real Estate Investment Trusts). On days like today, it shows you how important it is to spread your investment around different market sectors. It is important to note, that even if a stock pays a dividend, that doesn't mean that it can't go down in price. The old adage of "a rising tide lifts all boats", also applys to the downside.
Another important note I take from a down day is how important and smart it is to not always be invested. There is absolutely nothing wrong with a person having their money sit in a money market account when there is so much uncertainty in the markets. For example, if you would have been fully invested back in 2007-2008, you would have seen your investment account drop by over 40%. If you moved your money in and out of the market, and utilized the safety of being out of the markets, you would have not seen nearly the decline that the average investor did. I work with individuals all the time who question why their money is not invested in the market, and the answer is that it might not be a good time to be. I understand that money market funds (or cash) isn't paying any interest right now, but not making any interest is better than losing money.
I don't mean to be so drab on a day when the markets are down, but this is just part of what happens when you invest money. So, don't take my post as being overly negative, as it's just one day.
On a much brighter note, I'd like to wish those who celebrate a Happy Passover.
And like I said I would do, here's another golf clip in leu of the Masters golf tournament. Enjoy
http://www.youtube.com/watch?v=8x-nQ-vPw5k
