If you have been holding your breath since asset values started to decline last year, we suggest you relax and breathe a little. From April through June most of the stock, real estate, and commodity mutual funds we use increased in value by 15% to 35%.
How long does it take to master the piano, golf, carpentry, cooking, chess? Most of us would answer years, if not decades. But the field of investing is very different; instead of producing stellar results the most seasoned investment managers underperform a basic index fund.
As of October 10th, the S&P 500 is down 37% for the calendar year, a decline unmatched since 1931's slide of 43%. And unlike the crashes of 2000-2003 and 1973-1974, diversification into different asset classes has not reduced the carnage. International and small stocks have been hurt even more than the U.S. blue chips.