Ben Stein: XLF - Financial SPDR - Page 2

ItalianFX · #1 11-28-2007, 11:08 AM

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ItalianFX,

I'd probably go for the financials. You got 7500 to invest. Break it into three chunks and average it in. Put 2500 in now since the market has "corrected" 10%. If it truly is a correction, then the 2500 will show a profit when the market resumes its uptrend. If it isn't a correction, but rather the first leg of a downtrend, then you can pick two more points on the way down to put in your other two 2500 chunks. You should be able to get a pretty good entry point as your basis for the next 40 years.

I'd stay away from the emerging markets right now. They have run up. If the dollar turns stronger, these investments aren't going to look real good comparative to the US assets.

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I don't want to put all of my money into one thing. I'm looking at either 2 or 3 different index funds or ETFs. I do realize that the Emerging Markets have made a good run, and you're right, I should probably look for something else. I used to hold a Small-Cap ETF and a Dividend ETF and they did pretty well for me over a 2 year period. I just don't know where to go now, but I'm looking into holding them for a long period of time and so short-term variance is not a big deal.

tippy · #2 11-28-2007, 11:20 AM

My bad, I didn't understand that you weren't putting it all there. Probably go with 2500, divided into three $833 chunks, but fees might make this futile.

Who is your 401k through? My wife has Fidelity and it sucks. We don't even get the option of ETFs. You are lucky to get those choices.

ItalianFX · #3 11-28-2007, 11:23 AM

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My bad, I didn't understand that you weren't putting it all there. Probably go with 2500, divided into three $833 chunks, but fees might make this futile.

Who is your 401k through? My wife has Fidelity and it sucks. We don't even get the option of ETFs. You are lucky to get those choices.

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It is a Roth IRA and it is through Fidelity.

adios · #4 11-29-2007, 07:43 AM

I know of some what I consider savvy folks that are short XLF and long SKF. Clearly there's a credit crunch going on but IMO hard to forsee what government and central banks will do in response. Might be time to buy not sure. I'll admit I don't have the stones to get involved at this time. If residential real estate prices fall a lot more then we could see more problems as these problems have a "snowball" effect in other areas. I guess you could just buy GS and not worry too much.