No. of Recommendations: 2
>> Heh, but $10,000 in the S&P 500 at the end of 1999 was still only worth $8250 at the end of 2004. <<

You're absolutely right. But human nature would not have sold everything in early 2000 and bought back in at the end of 2002.

Human nature, including many financial planners, would have encouraged selling only after many months into the bear market, after you had already lost a lot of money...and may not have encouraged you to buy again until much of 2003 had past (and you lost a lot of the gains).

Keep in mind that many financial analysts downgrade a stock only AFTER the bad news that *already* knocked it down 30%, and upgrade them AFTER the news that *already* made them rise 20%. Closing the barn door after the horses already escaped is a common thing for many market analysts (and some financial planners who dart in and out of stocks following them).

Just remember that the market isn't Lake Woebegon. Not everyone can be "above average."

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