Achtung: Buying the dips in low yield world could endanger financial health

In Financial competency, Financial planning on 05/01/2021 at 5:10 am

The Nikkei closed on December 30 above the 27,000 mark. It was the index’s highest close since 1989. But the index is still 41% below its 1989 peak.

If valuations of risk assets only required ultra low interest rates then Japan would have been in a raging ‘bull’ market, someone commented in the FT.

Must have lessons for us investors in S’pore market about buying the dips.

Sounds like entry price, profits growth, corporate governance and financial engineering matter. LOL.

Sounds like an extreme example of reversion to the mean too

  1. That’s Nikkei, Topix and Mothers tell a different story. In any case Nikkei is a value investing strategy proxy. The strategy was out of favour so was the Nikkei and the recent rally is also due to value stocks outperforming.

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