Investing, in shares?

Question

is it a good idea at the moment to invest in the stock market at the moment or will it drop further

Answer 1

Another crystal ball question? sheesh. Anybody that knows that answer can make us all rich. But why would they need to tell?

I CAN tell you it is a better time now than a year ago when stocks were 20% higher. But that is when people were buying, that is why we had a top. The majority is wrong at tops and bottoms.

I CAN tell you we just hit a "Bear" market level and on average the typical Bear market goes down 25%. So historically it suggests another 5% down from here. But can be more or less, that is "average".

But Bear markets come about from recession usually and we are hardly in one. The future is definitely murky.    

I do not think it is a bad idea to invest here, now, if you are willing to see it fall another 5% or 10% and ride it down or wait for a while for it to recover.

I say that because when the market turns we will likely see some large gains and we will want to be in the market when it does turn.

Personally I am on the sidelines. I think we need to see some good news in any or most of housing, credit, employment, and energy costs before the market will return to a real Bull market.  

Right now ALL of those things are going in the WRONG direction with no bottom in sight.

Good Luck.

Answer 2

Hi Elaine --

If you invest in index funds (mutual funds or ETF) and hold it for several years (5-10 years), then you will not have to worry about market timing and earn decent returns  (8 - 20% based on the index fund you choose).

Answer 3

It will probably drop further much further but the forex market as a whole is looking good currently.