As I write today the ASX 200 Index is down around 3-4% and I would guess that most people now have seen around 30-60% slashed from the value of their stock portfolios. For many of us this has put us in the red and for some unlucky investors probably wiped out their portfolios.
Margin loans no longer look like a clever investment strategy, investment bankers look like reckless fools and we are bombarded by the endless wisdom dished out to us by financial journalists. It just doesn’t get much worse than this.
I did not expect things to get this grim and thought that around the 4800 – 5200 level on the ASX 200 was the bottom of the market. Clearly I was wrong, and it seems every day there is more bad news coming out of the U.S which is sending our stock market tumbling.
However at the risk of being flogged, I am starting to think it can not get any worse. In other words, we are close to the point of maximum pessimism where in theory there are once in a lifetime stock bargains to be snapped up.
So rather than be depressed, I am spending my time looking that those companies in which I have wanted to own shares in but were previously a little expensive for my tastes. Alternatively, perhaps it is time to grab some extra shares in companies like BHP Billiton, Commonwealth Bank (CBA) or dare I even mention it…. Westfield! (WDC)
Sometimes it is not a good idea to watch live stocks quotes as they can cloud your judgement. Instead arm yourself with a strong cup of coffee, do not get carried away by the crowd and try and think rationally before acting.