What To Buy Now

I am sure that if you have a brokerage account with a "full service" broker you have been getting calls about what to buy and sell. If you have big losses in certain stocks you might be hit with that great Wall Street lie to buy more so you can 'Dollar Cost Average'. It doesn't work.

In a recent study going back for 5 years a dollar cost averaging program was set up buying the S&P500 Index mutual fund. At the end of 62 months the investor had put in $31,000 and it was now worth $31,162. You would have done better in a savings account at your bank. And that assumes there was no commission or fees of any kind.

Let's say you owned a stock such as Cisco. This one is held by hundreds of thousands of investors and almost every one of them has a loss. It traded as high as $82 and for more than a year was in a range over $50/share. It was the darling of very broker from here to Timbuktu and when it started down they kept yelling buy more, buy more. Another one in this same category is Lucent going from about $80 to $5. Yuk!

Now Wall Street is trying to get you to buy more of these losers so you can "get out even" when it goes back up. And pigs can fly. Think about this. The person that currently owns these stocks or any similar ones with big losses is now waiting for them to go back up so they can "get out even". Ho boy. It should be extremely obvious that every time one of the monsters sticks its head up it is going to be hit with tremendous selling. There isn't a chance that any of them will ever get back to their old high prices