My Best Advice

Article Excerpt

Some investors wonder if we’re in a bear market — a downturn that lasts one to three years and knocks 20% or more off the market indexes. The last one began in mid-2000 and ended in the winter of 2002/2003. It was an extremely costly experience for investors who made the mistake of loading up on Internet and tech stocks. On the other hand, you came through fine if you followed our three-pronged approach: 1. focusing on well-established companies, which are far more likely than juniors to harbour hidden asset value; 2. spreading your money out across the five main economic sectors, if only because that improves your chances of latching on to a superstock that does two to three or more times better than average; and 3. downplaying stocks in the broker/ media limelight, where failure to live up to bloated expectations can lead to devastating share-price plunges. In fact, our portfolio clients made money in the last bear market, because we followed this…

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