4 Funds to Cut Your Risk in a Stock Market Correction
I don’t think that the recent market rumblings are signaling the onset of a bear market. But stocks are richly priced, and we’re overdue for at least a 10% plunge in share prices, which typically occurs once or twice a year, shaking investors’ confidence. Particularly if the eight-year bull market has pushed your allocation to stocks higher than you intended, this could be an ideal time to reduce risk. We suggest here three first-rate exchange-traded funds and one mutual fund
Is the Tail Wagging the Dog?
So many investors have been bailing out of actively managed mutual funds and piling into index and quasi-index funds via exchange-traded funds (ETFs) that, as Bloomberg Business Week points out, we’ve reached the point where there are now “more cartons than eggs.” That is, “the number of market indexes” [most created for ETFs to track] “now exceeds the number of U.S. stocks.” This most recent stampede has long precedent: When investors want something, Wall Street supplies it—
