Market timing a 'fool's game'

The Ticker

December 06, 1990|By Julius Westheimer

Do you try to "time" your stock purchases? Money magazine, November, says, "Trying to time the stock market is a fool's game."

The story goes on, "timers have a dismal long-term record. The stock market's tendency to rise over time favors 'buy-and-hold.' Since 1926, according to Ibbotson Associates, stocks have risen in more than two out of every three years. In effect, then, the buy-and-hold decision is right better than two thirds of the time, a feat few timers could match. Stand-pat investors are always right when it matters most -- in bull markets. Therefore, you're better off absorbing a bear market to be sure of catching the full bull. The typical bull market lasts 33 months."


Steven Bloom, Arthur Andersen & Co. (727-5800) will mail "Surviving Spouse's Checklist: A Tool to Evaluate Your Preparedness" if you phone him . . . Call Patrick Larkin, A. G. Edwards & Co. (547-1131) for a colorful and helpful "Tax Saver" booklet . . . Financial World, Dec. 11, runs an article, "Black & Decker: Shortsighted Short Sale." ("Slack Christmas and recession may hurt a bit, but don't look for the Baltimore toolmaker to disappear any time soon.") . . . Security Analysts hold "Environmental Panel," Dec. 13, Tremont Plaza, noon . . . Tomorrow night, "Wall Street Week with Louis Rukeyser" looks at "The Market for 1991 and Beyond." . . . Baltimore County public libraries have free updated copies of "Resource Directory for The Small Business Owner." Phone 887-6196.


"Short-term, stocks will rise. Long-term, they'll go much lower because of mounting debt and depression possibility." (Martin Zweig) . . . "I'm a long-term stock investor, but we're in a bear market rally now. However, signs do point to lower interest rates." (Beth Dater) . . . "This looks like an intermediate top, time to go short again. Next Dow target: 2,250." (Adrian Day's Investment Analyst) . . . "Several factors lead me to believe that stocks' slide since July is ending." (Eakle Report) . . . "Long-term, we're in the clutches of a bear market, but we're in its late stages." (Professional Tape Reader) . . . "Fact that recent rally stopped below 2,600 indicates great weakness." (Wellington Special Bulletin) . . . "Become more humble as the market goes your way." (Bernard Baruch, 1926)


"If you earn self-employed income, you may reduce your tax bill by as much as 25 percent -- up to $30,000 annually -- while saving for retirement. Self-employed people know that saving for retirement is a must, and by selecting a Keogh retirement plan before Dec. 31, 1990, you can prepare for a comfortable retirement future." (Investment Vision) . . . "Forget the mistletoe and break out the calculator: There's still time to see whether it's possible to reduce your 1990 tax bill." (Wall Street Journal article worth reading, with examples, Dec. 4). Ticker suggestion: Since the new tax bill treats different people differently, see your accountant promptly.


Although the year's shortest day is two weeks away, tonight marks the year's earliest sunset, with evenings beginning to brighten in the next few weeks. Sunrise lags until Jan. 8 . . . "Home-buying time may be here; mortgage rates were up but are now declining." (100 Highest Yields) . . . "The Hemline Index of Stock Prices, which has correctly forecast the stock market since the early 1920s, now projects a market bounce-back, with fall/winter fashions showing some mini-skirt lengths over six inches above the knee." (Smart Money, December) . . . "Stephen Leeb, Indicator Digest, flashes Wall Street green lights: drop in T-bill rates and significant decline in industrial commodity prices." (Dick Davis Digest, Dec. 3) . . . "Two proven ways to profit in bear markets: (1) buy stock in undervalued companies poised for a comeback and (2) sell overvalued stocks and bonds short." (James Rubin, M. D. Sass Investors Services).

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