The danger in the market right now is... you

Richard Ropelewski |

Take a few minutes to peruse the financial news online or tune into cable TV and you might end up with the investor equivalent of whiplash.

Some stocks zoom to nosebleed highs, even as the economy unloads one bad headline after another. Meanwhile, thousands of inexperienced day traders armed with smartphones flood the market with orders, pushing up shares of companies with virtually no earnings, some of them literally bankrupt.

All this activity and noise and to what end, the late John Bogle might ask. But it’s when the party gets the loudest, the headlines the craziest, that the usually more sedate investor begins to pay attention. And that’s the danger.

Legendary investor Sir John Templeton put it this way: “Bull markets are born on pessimism, grown on skepticism, mature on optimism, and die on euphoria.”

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The opinions voiced in this article are for general information only and are not intended to provide specific advice or recommendations for any individual.

All performance referenced is historical and is no guarantee of future results. All indices are unmanaged and may not be invested into directly