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Mines in the Minds of Investors

 

Despite the recent spate of good news from the likes of Motorola(MOT Quote) and Microsoft(MSFT Quote), we are at a danger point in the stock market.

It has little to do with the hard facts of where the market is going and everything to do with what you and I think and fear. The biggest investing mistakes have to do with these perceptions and emotions, so if we recognize the danger, perhaps we can steer clear of it. Here are five reasons I think there's danger in today's market:

  • The market has been down for nearly 18 months. Take a look at these numbers: The Dow Jones Industrial Average djia, down 10.4% from its 2000 peak as of June 30; the S&P 500 s&p500, off 19.8%; and the Nasdaq Composite Index nasdaq, a whopping 57.2% lower.
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    Dow Jones S&P 500 NASDAQ 10-Year Note
    10,390.11 1,103.25 2,189.61 34.48
    Oil *
    76.70
    UP
    1.21
    DOWN
    2.73
    DOWN
    4.74
    DOWN
    0.35
    10 Yr
    3.45%
    SPDR Gold
    113.11
    +0.01%
    -0.25%
    -0.22%
    -1.00%
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