After stocks ended 2010 making new highs, many experts have been calling for a healthy correction before putting more money into equities. And if you had listened to those folks you would have missed out on even more gains in the opening days of the New Year.
There are 2 main camps of folks that are calling (nay, praying) for this correction. Let me share with you their sad stories and why you should continue to pass on their faulty strategies.
Correction Camp #1: Missed the Party All Along
In 2008 it was easy (and 100% sane) to be a bearish investor as most signs looked like we were headed towards a second Great Depression. Even through most of 2009, when stocks rebounded, it was hard to fully embrace the turnaround story while economic booby traps seemed around every corner.
However, by the latter half of 2010 the clarity of the economic rebound story should have been obvious to all. But not all embraced this notion because their egos were so fully invested in being members of the bearish camp.
These double-dippers and doomsayers have already missed out on the lion’s share of the easy gains to be made from this rebound. So they need to invent reasons to get back in that allow them to save some face. And that reason is the “great correction.” Unfortunately for them, that correction keeps not coming. And they continue to miss out. (more)
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