Thought I'd post this information. It looks like stocks are sliding all around the world. Some markets have lost more than 3% since Friday. You can check out the individual market returns here.
There is some speculation that this could be caused by a number of reasons including Japan's Nikei index falling nearly 3.8% on alleged fear of the US budget deficit getting out of control and the protests against Japan in China.
The Financial Times reports that this may be the result of lower-than-expected first quarter earnings in a lot of American companies. Car manufacturers and technology experienced the brunt of the fall.
This might be a good time to buy an index fund.
We'll have to see what effect today's trading has on the US markets.
Buy an index fund? It depends on if your intentions are long or short.
ReplyDeleteLong, it could be argued that you'll rarely do better than an index fund so yes - now is a good time. As is any time.
Short, however, I don't think so. All the indices are down pretty sharply. I don't know if I'd jump in until they showed signs of being able to sustain a rally.
Most people buy for the long run. If you buy an index fund now, and you know there will be an inevitable rise as the the market recovers.
ReplyDeleteI agree with you, though, that if you are looking for short-term gains, it might be best to wait for the turnaround. However, even if you buy now, you're still going to get a better price than had you bought at the apex of the price.