Decade Of Disaster For Stocks? Not So Fast


This post by Jill Schlesinger originally appeared on CBS' MoneyWatch.com.



Today's Wall Street Journal says that stocks are on track to register the worst decade performance ever. Yes, even worse than the 1930's. Wow - that's saying something!
(AP Graphics)

Unless we get a late bounce over the next eight trading days (not such a long shot, considering that amid a holiday shortened week, low volume can lead to extreme moves) it will be rotten, but is the simple index the best way to measure performance?

MoneyWatch blogger and financial planner Allan Roth notes that the a "Lost Decade" for investors. Alan says that "when measured correctly, financial markets weren't nearly so bad. In fact, if you look at inflation-adjusted returns, this wasn't even the worst decade of the last four. If you diversified, kept costs low, and rebalanced your portfolio, odds are you actually did just fine."

It does seem like that many are jumping on the superlative aspect of the past decade. If it really stunk, than at least we can claim that it was THE WORST. Still, I prefer Allan's view - with a bit of discipline and an eye on expenses, most investors can weather even the worst (or second or third) decades. But remember, doing so means that you will forgo some of the superlative of the upside too. I think that's the right trade.

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(CBS)
Jill Schlesinger is the Editor-at-Large for CBS MoneyWatch.com. Prior to the launch of MoneyWatch, she was the Chief Investment Officer for an independent investment advisory firm. In her infancy, she was an options trader on the Commodities Exchange of New York.
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    Jill Schlesinger, CFP®, is the Emmy-nominated, Business Analyst for CBS News. She covers the economy, markets, investing and anything else with a dollar sign on TV, radio (including her nationally syndicated radio show), the web and her blog, "Jill on Money." Prior to her second career at CBS, Jill spent 14 years as the co-owner and Chief Investment Officer for an independent investment advisory firm. She began her career as a self-employed options trader on the Commodities Exchange of New York, following her graduation from Brown University.