How We Eluded The Bear Of 2000

The date October 13, 2000 will forever be embedded in my mind. It was the day after our mutual fund trend tracking indicator had broken its long-term trend line and I sold 100% of my clients' invested positions (and my own) and moved the proceeds to the safety of money market accounts. Some people thought we were nuts, but I had come to trust the numbers.

The shake out in the stock market, which started in April 2000, had all major indexes coming off their highs, violently followed by just as strong rally attempts. The roller coaster ride was so extreme that even usually slow moving mutual funds behaved as erratically as tech stocks.

By October, the markets had settled into a definable downtrend, at least according to my indicators. We sat safely on the sidelines and watched the unfolding of what is now considered to be one of the worst bear markets in history.

By April 2001 the markets really had taken a dive, but Wall Street analysts, brokers and the financial press continued to harp on the great buying opportunity this presented. Buying on dips, dollar cost averaging and "V" type recovery were continuously hyped to the unsuspecting public.

By the end of the year, and after the tragic events of 911, the markets were even lower and people began to wake up to the fact that the investing rules of the '90s were no longer applicable. Stories of investors having lost in excess of 50% of their portfolio value were the norm.

Why bring this up now? To illustrate the point that I have continuously propounded throughout the 90s; that a methodical, objective approach with clearly defined Buy and Sell signals is a "must" for any investor.

To say it more bluntly: If you buy an investment and you don't have a clear strategy for taking profits if it goes your way, or taking a small loss if it goes against you, you are not investing; you are merely gambling.

The last 2-1/2 years clearly illustrate that it is as important to be out of the market during bad times, as it is to be in the market during good times. Want proof?

According to InvesTech's monthly newsletter it turns out that, measuring from 1928 to 2002, if you started with $10 and you followed the famous buy-and-hold strategy, that $10 would become $10,957.

If you somehow missed the best 30 months, your $10 would only be $154. However, if you managed to miss the 30 worst months, your $10 would be $1,317,803! Thus, my point: Missing the worst periods has profound impact on long-run compounding. There are times when you end up better off by being out of the market.

Interestingly enough, if you missed the 30 best months and the 30 worst months, your $10 would still be worth $18,558, which is 80% higher than the buy-and-hold strategy. This all comes about because stock prices generally go down faster than they go up.

Wall Street and most people tend to overlook the value of minimizing loss, and that is exactly why the bear demolished more than 50% of many peoples' portfolios while I and those who trusted my advice escaped the worst of the beast's rampage.

About The Author

Ulli Niemann is an investment advisor and has been writing about objective, methodical approaches to investing for over 10 years. He eluded the bear market of 2000 and has helped hundreds of people make better investment decisions. To find out more about his approach and his FREE Newsletter, please visit: www.successful-investment.com; www.successful-investment.com

residential cleaning services Lincolnshire ..

In The News:

House Bill 469 would prevent AI systems from owning property, serving as executives, or gaining legal personhood in Ohio under Representative Thaddeus Claggett's proposal.

Public voter records expose retirees' personal details to election scammers who create targeted cons using names, addresses, and voting history data.

Instead of fearing what comes next with artificial intelligence, think outside the box. Here are high-earning AI jobs that don't require a computer science degree.

OpenAI CEO Sam Altman says polite words like "please" and "thank you" cost millions annually, while direct prompts may improve ChatGPT accuracy by several points.

Chattee Chat and GiMe Chat exposed intimate conversations and photos, revealing users spent up to $18,000 on AI companions before the breach.

New Instagram parental controls allow families to manage teen screen time and content limits through the Family Center with stricter safety settings.

Third-party security breach at Discord exposes sensitive user information including government IDs, highlighting cybersecurity risks from external service providers.

Survey of 1,000 students shows teens using AI for personal relationships while two-thirds of parents remain unaware of their children's AI usage.

Cybersecurity experts warn about a ShadowLeak vulnerability that weaponized ChatGPT's Deep Research agent to steal personal data from Gmail accounts through hidden commands.

Tesla's Full Self-Driving system faces federal investigation following 58 reports of crashes, with six vehicles running red lights before colliding with other cars.

The Fox News AI Newsletter brings you the latest developments on artificial intelligence, with news on OpenAI moving to soon allow erotica for adult users.

Eric Schmidt alerts that hackers can reverse-engineer AI models to bypass safety measures, citing examples like the jailbroken ChatGPT variant called DAN.

Cybercriminals exploit Microsoft Teams through impersonation, malicious links and fake profiles to gather intel and deliver ransomware to personal and work devices.

Google, Dior, Allianz and dozens of other companies lost sensitive customer data in Salesforce-related breaches affecting millions of records across multiple sectors.

Apple launches iOS 26 with new Preview app that combines document editing, PDF annotation and scanning features into one streamlined iPhone experience.

New AI road monitoring system uses sensor-embedded fabric to predict infrastructure problems, potentially reducing maintenance costs and traffic disruptions for cities.

Holiday charity scams target retirees through lookalike organization names, untraceable payment requests, and data broker information to steal donations.

The Federal Trade Commission says criminals are posing as IRS agents, law enforcement officers or other officials, often over the phone or online, to steal thousands of dollars at a time.

AI phishing scams now use voice cloning and deepfake technology to trick victims, but Kurt "CyberGuy" Knutsson reveals warning signs to watch for.

Inversion Space unveils Arc, a reusable reentry vehicle that can deliver up to 500 pounds of cargo from orbit to anywhere on Earth in under an hour.

Red flags like processing fees, urgent countdowns and requests for full Social Security numbers expose fraudulent settlement sites targeting consumers.

Comprehensive analysis of Google Maps, Waze and Apple Maps examines usability, routing accuracy, data handling and features across the top navigation platforms.

Expert analysis reveals whether wired Ethernet or wireless Wi-Fi connections are safer for home internet use, plus practical steps to secure your network from attackers.

Australian construction robot Charlotte uses sand, crushed brick and recycled glass to 3D print fireproof, floodproof homes with reduced carbon footprint.

Cybercriminals are using fake invitation emails to trick recipients into downloading malware and stealing personal information and data.

How We Eluded The Bear Of 2000

Stocks & Mutual Fund