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Welcome to Lowrisk.com! This study is the type of
research, data, and charts you will find throughout this site. Stuff you have been looking
for or wondering about, but haven't seen elsewhere. There is a lot here - make sure to
stop by our home to see what's available. And make
sure to subscribe to our 100% FREE Walker Market Letter. |
Nasdaq CRASH ?!?!
| The Nasdaq had a big rally early in the year. But that rally is a fond memory now. The Nasdaq peaked on March
10th and has since had several severe downdrafts. The latest one
started at the beginning of September, right on time for the seemingly
annual fall swoon. Here are some of the
recent swings in the Nasdaq...
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| We thought it might be interesting to look at the current market in
terms of the historic bear markets that
we feature on some of the other pages on this site. The chart below is a
daily chart of
the Nasdaq Composite. The red lines show
where a 10% correction and a 20% correction for the Nasdaq. The third line shows a
36% correction, which was the magnitude of the total drop in the 1987
Crash. As you can see, the Nasdaq's drop has already exceeded that of 1987.
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| This next chart is considerably more grim. Once again, this is a chart of the
Nasdaq Composite, this time each bar represents one month instead of
one day. The red lines correspond to the famous
bear markets we highlight on Lowrisk.com. The first is the '87 crash (as in the chart
above). The second line is the '73-74 bear market. The third line is the Nikkei bear
market that started in 1990. The lowest line is the '29 crash. These lines show the type
of dramatic losses that can occur in severe bear markets.
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How long will it go? Who
knows...we didn't put these graphs and examples in here to scare you or make
you hide your money under a mattress. The stock market is the place to be invested for the
long run. Over long periods of time the stock market has had far greater returns than any
other investment class. Read
those last two sentences again. The stock market is the place to be
invested for the long haul.
But if you are invested or considering investing in the stock market you need to be
prepared for bear markets. They will happen. And they will reduce the value of your
holdings substantially. If you are a dedicated buy and hold investor, you must consider
these bear markets. Will your steadfast resolve hold in the face of a 30% decline? How
about a larger decline? If not, then you need to reconsider the buy and hold philosophy. And while you are considering, you might want to stop by and subscribe to the 100% FREE Walker Market Letter. |
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