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Thursday, July 15, 2010

The Little Guy Seems Always to Chase the Mkt

I often hear that the market is "rigged' against the individual investor. It seems more likely to me (and anyone that has studied behavioral finance) that the major thing that "rigs" investment markets against the individual is the one that the investor can see in the mirror.

From the WSJ

For the week ended July 7, ICI reported stock funds had outflows of $4.23 billion, compared with $216 million a week earlier. U.S. stocks had $4.12 billion withdrawn and $112 million was withdrawn from foreign funds.
Bond funds took in $6.02 billion, compared with $3.49 billion the previous week, said ICI. Taxable funds had inflows of $5.04 billion, while municipal funds added $979 million

S&P 500 return form the beginning of the week cited (jun 30) till July 14 +6.5%
Aggregate bond index (etf AGG) return for that week = 0

S&P 500 return form the end of the week cited (jul 7) till July 14 +3.3%
Aggregate bond index (etf AGG) return for that week = 0

one month chart for the bond aggreate index



one month chart for the  sp  500 (spy)


at least for this period the major outflows from stocks came at the bottom and the money that flowed into bonds has done nothing.

buy high sell low based on emotion and ;looking into the rearview mirror  is it really a "rigged market" that is the major enemy to individual investors ? or as shakespeare said "the fault methinks lies within"?

3 comments:

淑蔡承均dgd周真淑ii淑 said...

不願彎腰撿拾一根針的人,永遠不值得一塊錢。..................................................

姿柯瑩柯dgdd憶曾g智曾 said...

來看看你逛逛blog囉,加油!............................................................

吳婷婷 said...

我們這一代最偉大的發現是,人類可以藉由改變心中的態度來改變人生。.......................................................