Stock Market woes — who’s to “blame”?
It seems, for the past week or so, the stock market is way up in the morning and then down by the end of the day. I suspect this is the result of active traders who, daily, sell high at the end of one day and then re-buy low at the beginning of the next day, knowing they will sell again. Yes, this is probably legal and they are making money but, for those of us who have “un-managed” funds (I have Vanguard S&P index funds), we will lose every day.
I already am angered that I can’t get a savings account or a CD that pays a decent interest, forcing me and millions of other retirees to have to gamble on the stock market with our retirement savings. But now, it seems the gambling has stepped up to a whole new level.
Am I right? Will this continue by all these new young traders? If so, what can I do? Transfer my money to a managed account with higher fees? Try to play their game?
I have about $100,000 in my account (I had about $109,000 a week ago). If this keeps up, I will soon have zero. Can you suggest some reputable fiduciary firms that will keep up with these traders for me by managing my account?
I’ve always read your column and listened to you on WGN and appreciate your approach.
Thank you for your time.
Terry Says
Whew! Calm down. What those active traders do may impact the market for a few hours or a few days, but if you’re in the stock market for the long run, it shouldn’t matter at all to you!!
Sounds like you’re envious of their opportunity to take quick profits — or losses — but do you really want to take that risk?
They aren’t “hurting’ the markets; in fact they are providing liquidity in the markets. Just a few years ago people were complaining that the big institutions were moving the markets, and then it was the algorithms.
What most people don’t understand is that trading volume is great because it gives investors with an opposite opinion a chance to act. That’s how markets work, you know. Remember — for every buyer there is a seller. And both sides think they are correct for that one moment!
As for you, set aside some “chicken money” in CDs– and place the blame on the Fed for keeping rates artificially low. That’s about to change.
And your stock investments should be long term –knowing that the big long-term trend has been UP for over 100 years. Unless America goes away, your investments are not going to be “zero.” Make sure you have a diversified portfolio or mutual funds.
And then –Stop looking!!
