We thought it timely to refer back to our thoughts from our Q1 2010 Newsletter, penned earlier this month.
“The year 2010 will be a teaser for many investors. We feel the markets will end up somewhere between 8 – 10% but the journey will be one we have not experienced recently.
The year 2010, in our opinion, will be a roller coaster market with frequent drops of 10% -15% or more, chasing the weaker hands out of the capital markets, just in time for the capital markets to take an about face and move to new highs, again frustrating shorter term investors.
Our thesis relies on two premises. First, the economy will need to transition from assisted growth (government stimulus) to self reliance, leaving many to question the strength and timing of the transition period. Second, the “buy and hold is dead” thesis will lead to short-sighted investors selling at the small drops, only to be frustrated as the capital markets turn, leaving many in negative return territory as the markets have a nice total gain for the year. We are already seeing this second event occur in the commodity area, and expect the same in the capital markets eventually.”
Again, these are our toughts and no guarantees of course, but possibly timely!
Have a Good Day! Thanks