5/9/2010 Historical Post


From: Dale Beals <dpbeals@comcast.net>
Subject: Update
Date: May 9, 2010 8:39:45 PM CDT
Hi everyone…

Just wanted you to know that I bought some (but not all) of the stock funds back on Friday that I sold on Thursday. My recollection is that all purchases were below the closing prices of Thursday (good for us), although some were still above the sale prices of Thursday. Why?
1. Methodology – the asset allocation discipline we follow is superior over the long run to anyone’s attempt (even mine… especially mine?) to outguess the market direction from week to week. Once I knew the immediate “crash” would not continue, there was no reason to continue overriding the methodology. I’m confident the methodology (and we) will handle a decline just fine, and make good money over the long run.
2. Stock Market/ Investor Behavior – Stocks rarely go in the same direction every day for very long. Since last week was so brutal, the probability is high for a bounce sometime early this week, especially if the Financial Leaders in Europe come up with a “solution” for the Greek debt crisis over the weekend. (Remember when the US Government announced the 1st and the 2nd bailout packages? There were always bounces, even if they were temporary.)
I want to emphasize my belief that we will make money over time by following a discipline, not by trading in and out of the markets. Thursday’s market behavior involved the biggest one day point drop in the history of the Dow Jones industrial average, so, it made sense to play it safer with your money until things stabilized somewhat. Volatility will probably continue… up as well as down… for a while, but our methodology compensates for that, and manages risk accordingly.
Thanks for your trust. I fully intend to profit from the expected market rushes of greed and fear by following our discipline.