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Maybe, Just Maybe, We Have Actually Hit the Bottom
Posted on December 16, 2008 at 7:03 pm
Filed Under Financial Markets, Financial Planning, Investment Planning, Mutual Funds
In the article entitled “Is the Tide Turning? Managers Think So”, Mark Noble provides some very interesting reasons as to why many Managers seem to think that 2009 may just in fact be better then previously expected.
According to the Russell Investment Manager Outlook poll for the fourth quarter, “more than 70% of Canadian managers expect positive returns for the S&P/TSX in 2009. Further, 90% of managers surveyed believe the TSX is either fairly valued or undervalued.” In other words, these beliefs are not a direct result of any specific event that has occured in the Canadian market recently, but more because of a belief that the gloom and doom of 2008 and looking into the first half of 2009 has already been “built into” the current pricing of the Canadian index known as the S&P/TSX Composite.
Does this positive news, something we haven’t heard for quite some time, mean that we can expect to recoup our losses from 2008. According to the same poll, that is likely not the case. The article goes on to say “Managers seem to be leaning toward a slow and methodical recovery over the next year. More than 40% of respondents expect the Canadian market to bounce back more than 10% — an impressive comeback — but this is against a backdrop of near 40% losses for 2008.
Your Take-Away: As I mentioned in my last post, you can take just about any quote out of context and generally speaking, even shape it how you want it to sound. That said, this article and poll simply proves to me that it is time to consider getting back into the market or at least sticking with your existing plan. If you have taken a large chunk of your portfolio out of the market and are too afraid to jump back in full force, consider moving back in with smaller amounts spaced over the next couple of weeks and months. If you never did take your money out in the first place, make sure you don’t start now.
No one really knows what the future holds, and I’m certainly not arrogant enough to say that I do. I just can’t help but think that if some of the smartest minds and Money Managers in our Country believe that we most likely will not see much more of a decline in our economy and that we may have actually hit rock bottom, maybe it’s time we start to listen.
Until next time, have a Terrific Tuesday!
Chris
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