The current uptrend of the stock market is widely believed to have begun on March 6, 2009. That means that on Wednesday of this week the current stock market cycle will have its fourth birthday.
Another big anniversary of the stock market was back on October 9, 2007. That is the day that the Dow Jones Industrial Average closed at an all-time high level of 14,164.
Just yesterday, March 5th, the financial media made a huge deal out of the new all-time record Dow Jones Industrials close of 14,254. The financial media over-hypes any financial event and completely blows it out of proportion as often as possible.
Remember the Fiscal Cliff last December? Filled up your car with gas in the last couple of weeks? Have you heard about the Sequestration that began last week on March 1st?
In spite of all these overly hyped scary financial media events, the U.S. stock markets have gone straight up in the last few months. This was mainly due to the fact that the financial media was cheerleading the entire time.
Whenever the U.S. stock markets have all-time events, or birthdays, it is a good time to take a look at what makes up your current stock market investments. An even better exercise is to ask yourself, “Why do I own this stock or stock mutual fund.”
The current stock market advance may continue, or it may run out of momentum any day now. The most important investment management strategy now is to have a plan in place for each event.
If the stock markets continue higher, your investment management strategy should continue as planned. In the last four years, there is a good chance that you may have recovered the majority of any stock market losses that you had previously.
If the stock markets begin going down, that is where the plan comes in handy. You don’t need to think about selling everything that you own in the stock markets now. Instead you need to take a close look at any stock market investments that you own that have not kept up with the overall stock market benchmarks.
Most Minnesota stock market investors have one or two individual stocks or stock mutual funds that have not kept pace with the recent stock market advance. For many reasons, some of their stock market investments have not worked out as well as others.
With the stock market now at multi-year high price levels, now is a good time to sell those lagging stock market positions that you currently own.
On this stock market birthday, give yourself the present of another opportunity to get back the most money that you can now from your worst stock market positions.
Ric Lager
Lager & Company, Inc.
