Many Mutual Funds are now seeing their total funds being reduced dramatically by stock market losses and investor redemptions. In order to stop the redemptions Mutual Funds try to intimidate Baby Boomers not to do anything to protect their nest eggs in retirement.

I have taken some statements from the newspapers to make my points. Unfortunately most financial commentators think the same way and have a similar view on investing as the fund managers they write about. But rather than get into arguments with the writers I’d rather try and promote a different view. I want to win the war not just a battle.

Their liberal use of the phrase “Investors should not panic” without any qualification is probably one of the most flagrant ways they intimidate us. First of all if an investor uses a rational investment strategy and exercises stop losses when triggered to exit the market this is panicking by their definition. Even though this may be a well thought out strategy designed to minimise losses and a recognition that the market has proved your investment strategy wrong. There is no loss of face here because the investment didn’t work out. Just forget it and move on. Read the rest of this entry »

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The majority of Mutual Funds have to be fully invested in the markets at all times regardless of the volatility or state of the market. I wondered why this is so because it flies in the face of reason.

An interesting article written in June 2004 by Maria Brill called The Cash Conundrum explains why this is so.

In 2003 the recent bull market began and there was a massive inflow of money into mutual funds. Some funds who acted rationally and in their investors interest like First Eagle U.S. Value Fund. They found they had more money to invest than good investment opportunities. Charles de Vaulx a co-manager of the fund said, Read the rest of this entry »

Brokers are now saying things are overdone. The sentiment is too negative and it has taken the markets down too far. Stock Market Reality is now biting the hand that feeds it. Stock Brokers and Fund Managers are feeling the pinch as the stock market drops like a stone. Through their over-trading and market manipulation they have destroyed their own wealth machine - the stock market. In so doing they have hurt us all and Baby Boomers are the ones who can least afford this down-turn right now.

Here is an extract from an article written by an Australian Broker:

Read the rest of this entry »

In the world of buy and hold the only one doing it is probably you. Everyone else is timing the market and maybe using your money to do it.

Brokers put out regular newsletters to buy, hold, accumulate and occasionally sell stocks. Isn’t that market timing?

Mutual Fund managers feverishly trade stocks in their funds to get higher returns as their commission is based on how big the funds under management are. Aren’t they timing the market? Read the rest of this entry »

Have you noticed that whenever you talk with a financial planner they talk in terms of certainties. But when you sign the investment documents they point out that there are no guarantees the things they told us before may apply?

Do you go to a car showroom and hear them tell you all the great things about their cars but as you drive it out of the showroom do they make you sign a waiver and tell you the car may not work as stated. It may stop as soon as you leave the driveway, the doors may fall off, the engine may not reach the speeds they said it would. Read the rest of this entry »

It really doesn’t matter what country you belong to. If you have a retirement nest egg and you are in retirement then it is still subject to the same dangers whether you are in the USA, Australia, Europe or Asia. Protecting your nest egg is universal.

Buy and Hold will cause you the same anxiety right now wherever you are in the world as you watch your nest egg dive just when you need it. GE that once great Buy and Hold company is down 84% from its highs.

Large losses are not the preserve of one nation. The global community makes sure we all get our share. But often that share is unevenly distributed. Avoid them like the plague.

High Fees and charges do the same damage to a nest egg whether it be in Australia, USA, Europe or anywhere good people have to contribute to their own retirement by building a retirement nest egg.

Read the rest of this entry »

The DOW is only 0.8% off 20% losses the technical level for declaring a Bear Market. What does a Baby Boomer do now?

In these volatile times cash is a position for Baby Boomers in retirement. But it may be too late to exit those poor performing buy and hold mutual funds.

It is time to review your retirement nest egg and consider each investment. If there are significant losses in some of the investments then it makes no sense to sell them right now. But if you have some investments down around 10% it might be worth considering putting them into cash.

This will at least provide you with some income to hopefully ride out any further market turmoil without forcing you to sell those investments with large losses against them.

It may be best to look at the Fixed Interest/Income Investments first. Read the rest of this entry »

This post is just a quick one to point out several important topics affecting Baby Boomers approaching retirement. I find MarketWatch has some very interesting articles and audio’s. Some I don’t agree with but the ones listed here I believe are important to us Baby Boomers.

This will be a short post because a family matter has taken most of my attention. It should be back to normal tomorrow.

They just seemed to me to hit all our hot buttons with their topics.

Consumers more at risk from financial scams as stocks slump Read the rest of this entry »