2008-03-08

Stay 60-70% In Stocks?

Kiplinger’s suggests the market is suffering more from the “mood of investors” than fundamental weaknesses: “Outside of real estate and the financial sector, there haven’t been unusually large numbers of profit warnings, dividend cuts and other signs of serious distress.” It notes:

  • 64% of reporting companies exceeded analysts’ estimates for Q4 results;
  • 11% of reporting companies matched analysts’ estimates for Q4 results; and
  • Reporting companies’ Q4 profits rose 18% on average from Q4 2006—if you exclude financial companies.

The overall recommendation of the article is for long-term investors to stay 60-70% invested in stocks (including stock funds). For the full article, see the April issue of Kiplinger’s. (At the time of this post, only the March issue was available online.)

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