In light of the market crash of Fall 2008, does diversification still make sense? In this video excerpt, Harry Markowitz explains the even in the market crash, different asset classes did behave as one would have expected them to:

I’m unable to highlight all the articles worth checking out in my weekly round up but you can check them out through my Twitter feed. I try and keep my tweets to an average of not more than 5 per weekday.

Happy Halloween everyone! Have a great weekend!

This article has 14 comments

  1. Thanks for mentioning the brokerage comparison.


  2. Thanks for the mention, hopefully my RESP problems are finally done? nah, I don’t think that either, but you never know. Have a great weekend!

  3. “Battered Investor Syndrome” is some nice melodrama. It’s tough when you start with a ton more money than other people and end up with only a lot more money than other people. If that Forbes article resonates with most readers, then I’m just not wired the way most people are.

  4. Oops. After the ray of sunshine in my last comment, I forgot to say thanks for the mention. I liked the Markowitz interview. Instead of hand-wringing about being battered as an investor, he just analyzes things and says that’s the way it goes.

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  6. I don’t understand why an investor should feel battered after living through a couple bear markets. There is nothing like the experience of a few market cycles to give an investor an idea of how markets work and the seasoning that enables them to stick to the discipline of buying low and selling high. In other words, the result should be a better investor, one with the “iron stomach” for buying into stock markets when pessimism is heavy and the fortitude to rebalance away from stocks when it’s optimism’s turn to peak.

  7. Hi CC! Thanks for including my post on your lovely blog! 🙂 Hope you have a great weekend.

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  9. @Michael, @Larry: It makes total sense that the more stocks go down, the more attractive they become. But most investors become queasy after a sharp decline. I know so many who quit stocks entirely during the 2001-03 bear market and during the 2008-09 bear market. The irony? Some of the investors who swore off stocks entirely after the first bear market, started dipping their toes into the market again in 2006 or 2006 after years of double digit returns.

  10. Hi CC, I was just a little put off by the phrase “battered investor syndrome” because it draws a comparison between a battered wife and an investor who loses some money in the stock market. Outside of this implied comparison, the rest of the article made sense. Investors who don’t understand markets are indeed likely to stay away after being burned.

  11. Everything tastes better when it’s battered and then deep fried. But it’s very bad for your arteries so you should only have it on occasion.

  12. Thanks very much for the mention CC! Enjoy your weekend!

  13. Thanks for the mention! Hopefully Hulu will be working (legally) in Canada soon, that would be a major improvement for free TV online.