Meir Statman : Coping with Investment Losses : The Street
Meir Statman, Glenn Klimek Professor of Finance, contributed his ideas and expertise about how to handle investment losses to an article in The Street. He discusses the risks to being safe, the need to consider all capital, and the need to put things into perspective.
He poses these 3 questions in the article:
- Is anyone bleeding or is it only a fender bender?
- Has the value of your portfolio declined so much that your retirement income is in peril? Or is it only that your ego is dented?
- If you arrange your portfolio in layers of a pyramid by priority, you have at least two layers, "not being poor" at the bottom, and "being rich" above it. Did the stock market decline destroy your being rich layer? Did it do serious damage to your not being poor layer?
Find the full article here »
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