There will always be a crisis - apparent or temporarily hidden. Uncertainty is the permanent condition of the world and the markets themselves. In contrast, think about the investments you might have made in times of confidence and certainty - 1999 comes to mind, so does 2007. How would the investments you made then look now?
Periods of uncertainty are no fun, but periods of certainty are an even more dangerous time for getting overly confident.
"Be Fearful when others are Greedy, Be Greedy When others are Fearful" - Warren Buffet
Santiago, I may not put all my investments overseas or in Europe right now nor ever. But it is a great time to invest especially if your not retiring in the next 10+ Years.
Good Luck David Kleinik
If you are relatively young and still contributing to your retirement plans why wouldn't you want to invest in a "down crises driven market"? As the old Chinese saying goes "With Crises there is opportunity". Also, considered that much of the risk is already priced into the European markets. Staying diversified may help you stave off some the risk for the next crises which is unknown to us. As one of my mentors once told me "Remember Jeff, diversification is your buddy!
As Jim Cramer says "there's always a bull market somewhere" - if you have money to invest, you should work with a professional to design an asset allocation for you saved on your risk tolerance, time frame to goal and tax situation. While you may not be immune from a financial crisis in Europe there are investments and products out there that may help limit your risk.
Invest according to your risk tolerance and time horizon. Stay diversified and rebalance on the dips and peaks. When adding new money dollar cost average that money into the market and then go live your life.
When you invest, you can control basically five major aspects of your portfolio: 1. The over all diversification and timeline 2. The costs related to the investment options 3. The negative impacts from income taxes 4. The exposure to long-term interest rate risks 5. The exposure to long -term inflation risks
In your situation, i would expand the diversification of your portfolio and have a combination of US Equities (large/mid/small), International and Emerging stocks. Based on your personal risk profile you have to determine how much is allocated to equities. I will assume a 80% equity allocation. I would then diversify this allocation 40% US, 20% International, and 20% Emerging. I would also say "good buy" to individual stocks and mutual funds because I would recommend you consider using an ETF model portfolio solution! think long-term and be patient.
Rob Riedl, CPA, CFP, AWMA Endowment Wealth Management