A BOTTOM, AT LAST (veröffentlicht am 02.04)
The Lehman research, which looked at stock prices since World War II, shows that after a third rate cut in an easing cycle, the S&P 500 tends to fall not much more than 2 percent from the day of the third rate cut to the time that a rally begins.
The current cycle, so far, hasn't bucked that trend. The Fed cut rates for the third time in three months on March 20. Two days later, the S&P had dropped 2.2 percent. In the days following, it rebounded, closing Friday's trading session 1.5 percent above its March 20 level. "We can't say for sure that the bottom is behind us, but we think it's imminent," says Charles Reinhard, senior U.S. investment strategist at Lehman Brothers.
Mr. Reinhard says the market is oversold at current levels by some 21 percent, placing his year-end target for the S&P 500 at 1,400. From that perspective, he says, the upside risks for stocks now far outweigh the downside pitfalls. Lehman research shows that, historically, S&P 500 stocks tend to gain 31 percent in the first year after reaching their low point in a down cycle. More important, however, is how fast the market accumulates those gains. Mr. Reinhard says that one third of the upward move has occurred in the first two weeks of the rebound, and 45 percent of the gains in the first five weeks. "If you blink, you miss it," he says.
The moral of the story? Do not try to time the market. Stay invested through the downturn, or you might lose the juiciest part of a rebound. Those investors who unnecessarily tinker with their holdings always end up with poor-performing portfolios. And, to quote Mr. William Shakespeare, "But O, how bitter a thing it is to look into happiness through another man's eyes."
Oder auf Deutsch:
Wer jetzt aussteigt, wird den richtigen Einstiegszeitpunkt verpassen. (Die o.g. Prozentsätze sollte man großzügig interpretieren, da sie sich auf Standardwerte und nicht auf die Nasdaq beziehen.)
R.
The Lehman research, which looked at stock prices since World War II, shows that after a third rate cut in an easing cycle, the S&P 500 tends to fall not much more than 2 percent from the day of the third rate cut to the time that a rally begins.
The current cycle, so far, hasn't bucked that trend. The Fed cut rates for the third time in three months on March 20. Two days later, the S&P had dropped 2.2 percent. In the days following, it rebounded, closing Friday's trading session 1.5 percent above its March 20 level. "We can't say for sure that the bottom is behind us, but we think it's imminent," says Charles Reinhard, senior U.S. investment strategist at Lehman Brothers.
Mr. Reinhard says the market is oversold at current levels by some 21 percent, placing his year-end target for the S&P 500 at 1,400. From that perspective, he says, the upside risks for stocks now far outweigh the downside pitfalls. Lehman research shows that, historically, S&P 500 stocks tend to gain 31 percent in the first year after reaching their low point in a down cycle. More important, however, is how fast the market accumulates those gains. Mr. Reinhard says that one third of the upward move has occurred in the first two weeks of the rebound, and 45 percent of the gains in the first five weeks. "If you blink, you miss it," he says.
The moral of the story? Do not try to time the market. Stay invested through the downturn, or you might lose the juiciest part of a rebound. Those investors who unnecessarily tinker with their holdings always end up with poor-performing portfolios. And, to quote Mr. William Shakespeare, "But O, how bitter a thing it is to look into happiness through another man's eyes."
Oder auf Deutsch:
Wer jetzt aussteigt, wird den richtigen Einstiegszeitpunkt verpassen. (Die o.g. Prozentsätze sollte man großzügig interpretieren, da sie sich auf Standardwerte und nicht auf die Nasdaq beziehen.)
R.
