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Friday, June 16, 2006

Stockmarkets will recover

Compared to the peak a few weeks ago, the stockmarkets have fallen by 9% to 17% to the lows.


Peak Low %
Nikkei Japan 17291 14218 -17.8%
STI, Singapore 2660 2297 -13.6%
Nasdaq, USA 2345 2072 -11.6%
Dow Jones, USA 11642 10706 -8.0%


Many of these markets are now recovering. If you invest in the stockmarket now, you pay a much lower price than the recent peak.

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Is there a chance that it may go lower?

Yes, but it is a small chance. The worse case scenario was during September 1987. The stockmarket crashed by 19% over 2 months. However, the crash was temporary. Within 11 months, it fully recovered to the level before the crash.

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