This Week’s Stock Market Video
Saving Time, Making Money
Fortune Cookie
In Case You Missed It
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I hope it doesn’t seem odd that I’m ignoring two huge events in this Cabot Wealth Advisory. Halloween is a very big deal in Salem, Massachusetts, but it doesn’t have anything to do with stock markets. And next Tuesday’s elections are such a huge event that I’m going to be writing about them on Tuesday itself.
Today, I want to talk about commodities. Pork bellies, crude oil and precious metals are what come to mind when most people think about commodities. But fascinating as they are for investors with plenty of confidence and a taste for action, they can’t hold a candle to the ultimate commodity, which is time.
Everybody gets the exact same amount of time in a day and nobody seems to have enough of it. And if you want proof that time is the ultimate commodity, consider that there are people who will pay large amounts of money to save small amounts of it.
This isn’t going to be one of those rants about the irony that time seems to fast-forward during enjoyable moments and slow to a crawl during awful ones. That’s been done to death.
I have a more serious point in mind, which is that not having enough time to do what needs to be done is actually costing you money and potentially ruining your chances for a comfortable retirement.
Here’s how.
Among the many things that your lack of time is keeping you from doing is taking charge of your own investment portfolio. Unless you’re a great exception to the rule, your retirement accounts are in the hands of your company’s 401(k) program or an IRA. But surveys tell us that people in these programs seldom or never rebalance their portfolios or change their allocations. What goes into equities (often index funds) stays there, and what goes into bonds also just sits there. I won’t spend a lot of time on the pros and cons of index funds, except to note that anyone whose portfolio has been in index funds since the start of the 21st century has been through a couple of very painful meltdowns. And even though markets have regained and surpassed their old highs, the time that was lost while the indexes healed their substantial wounds can never be regained.
So, short and sweet, I would suggest that any investor who has lost years of potential gains in the bursting of the Tech and Housing Bubbles, and who doesn’t have the free time to spend mastering the ups, downs, ins and outs of the stock market should get some help from Cabot.
I spend my entire working week researching, thinking about and writing about what’s happening in equity markets and what investors should do about it. I write Cabot China & Emerging Markets Report, which advises subscribers on which stock to buy and when, and which stocks to sell and when.
Like Mike Cintolo’s Cabot Market Letter, my China advisory is an ultimate time saver. It gives you instant access to years of market study and expertise. And it will both save you time and help you make up for lost time.
And it doesn’t take much time to subscribe. A simple click right here will get you started.
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In this week’s Stock Market Video, I talk about the dramatic V-shaped correction and recovery in the major indexes and many leading stocks. My view is that the reasons for these moves are less important than understanding the major trend of the market, which is now up. Accordingly, I advise starting a gradual return to the market. I have a couple of negative charts about commodities and some very strong stocks in China and elsewhere. Click below to watch the video.
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Here’s this week’s Fortune Cookie. Remember, you can always view all previous Fortune Cookies here and Contrary Opinion buttons here.
Tim’s Comment: On the surface, this is an argument for education (in fields where knowledge rules, like rocket design or drug development) or practice (in fields where physical skill rules, like baseball or brain surgery). But at heart, it’s an argument for psychological preparation, because the greatest opportunities—and this includes buying stocks when they’re down—typically require one to do something that no one else is doing, and this requires great mental fortitude.
Paul’s Comment: Mr. Disraeli chose to make his wise observation about opportunities, but it applies equally well to negative circumstances. Whether stocks are going up or going down, growth investors have constant decisions to make, and it’s a heck of a lot easier to think about them in advance. You can’t know what the market is going to do, but you can know what you’ll do no matter what happens.
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In case you didn’t get a chance to read all the issues of Cabot Wealth Advisory this week and want to catch up on any investing and stock tips you might have missed, there are links below to each issue.
Cabot Wealth Advisory 10/27/14 – The Dow Jones Transportation Average
Tim Lutts, the Chief Analyst of Cabot Stock of the Month, writes in this issue about Halloween in Salem, the Prospect Mountain Incline Railway at Lake George, New York, and the companies that survived after building it. Stock discussed: United Technologies (UTX).
Cabot Wealth Advisory 10/28/14 – Earnings Season and Other Surprises
In this issue, I run down the vagaries of earnings season (and a few other reasons a stock might take a nosedive) and what to do when that happens. I also give my annual pitch for giving blood. Stock discussed: Autohome (ATHM).
Cabot Wealth Advisory 10/30/14 – Four Steps to Crash-Proof Your Portfolio
Nancy Zambell, editor of Investment Digest and Dividend Digest, runs down some steps you can take to protect your portfolio from major market meltdowns. She also has a couple of strong stocks to recommend. Stocks discussed: Barracuda Networks (CUDA) and Tesoro (TSO).
Have a great weekend,
Paul Goodwin
Chief Analyst, Cabot China & Emerging Markets Report
And Editor of Cabot Wealth Advisory
