Thursday August 4: As far as updating our forecasts, I guess it must be done: how about trying to predict the bottom for the Dow now?

Thursday August 4: As far as updating our forecasts, I guess it must be done: how about trying to predict the bottom for the Dow now? That should be fun. Why don’t we make a pool and award it to the one who guesses it the closest? Anyone interested? (I’m NOT. I don’t want to lose twice!!) Anyway, I‘ll hazard a guess: the Dow will go as low as 9,700, OK? How about that?

Investing: The ones who can gauge the bottom of this cycle will stand to make some money. There are some strategies like “doubling down” that work well with large mutual funds. Doubling down goes like this: When the market takes a large drop, buy some of your favorite fund, say $2000. If it goes up the next day, just say “Yea! I made some money!” If it goes down, buy $4000. Then the same, if it goes up, say Yea! And if it goes down again, buy $8000. This technique is not for the squeamish. But it is intriguing, because it helps you gauge the bottom, and it ensures that your weighted average cost is lower. It is also spreads your investment over time, which is the classical advice. I tend to like it and use it cautiously when buying and also like the reverse “doubling-up” when selling. Also, you can only double with a mutual fund. Doubling down with an individual stock poses the risk of an individual bankruptcy.