It's lost 30% of its value, was that to be expected? Are you saying it won't fall any further? To me, it seems that you are glossing over a large stock market crash.
Talking about it being 'to be expected' is a nonsense. If the market is so predictable, kindly enlighten us about what happens next, rather than being wise in hindsight.
They call them corrections for a reason. Extreme moves in one direction increase the likelihood of extreme moves in the opposite direction. You can chart volatility just like you can chart the price. Volatility is high right now.
Corrections are not the same as crashes that wipe out 20 or 30 years of gains. The index is still up for the year. It is very disturbing that the govt. rushes in to attack short sellers and prop up the market artifically, funneling money into it. They show no enthusiasm to attempt to curb the bubble as its growing as the mkt is on the way up. In that way they are the same as the western world.
They are called corrections some time after the event, once we've all had our fill of hindsight. Are you trying to predict the market by claiming that it won't fall any further? If you aren't, then how can you be sure that this is a correction and not a crash?
Even by your extreme measures of what a crash is, you have to realise that they don't happen instantly... who knows how long the market might sink for... Or rebound?
Just eyeballing the chart in the story, it's still up 10% from January 2015. That's not a bad return. This looks like a correction of a ridiculous overvaluation spike to me.
No market is predictable. That is why you don't try to do it. Invest regularly, i.e. dollar cost averaging. The couple who invested their entire savings in one shot during an obvious run-up made an all to common emotional mistake.
OC I haven't studied the situation there in any depth.
But you're implicitly making a prediction or an assumption here, namely that there has been a correction. That there has been a correction. Are you sure that the market won't fall another 30% in the coming weeks?
Something that goes up for no good reason (spurred by margin), will come back down for a very good reason: it should have never been up there to begin with.
Whether it's a week, a month, or a year, their market is going a lot lower yet. It'll retrace back to where it was, no matter what the central government does today. Trillions of dollars in real wealth will be lost in the debacle, as the event sets off dominoes.
Unless you were implying that this will continue, "Are you sure that the market won't fall another 30% in the coming weeks?" is simply a non sequitur. As of now this is something that could be called a correction; it could develop into something that could be called a crash.
As of now, if you invested the index four months ago, you haven't lost a penny.
Talking about it being 'to be expected' is a nonsense. If the market is so predictable, kindly enlighten us about what happens next, rather than being wise in hindsight.