how to deal with the situation like 911

**n_xian** Wed Jun 29, 2005 6:03 pm

how to deal with the situation like 911
If the event like 911 happen again, what is the strategy of blast investing?

options:
1. sell all of them immediately and buy back later right after market become stable at lower level

2. hold and no action

3. only put in extra money after market become stable at lower level.

**blast_investor** Wed Jun 29, 2005 8:56 pm

n_xian:

In a case of sudden bad event, it is typically a buying opportunity. Not a good choice to sell and buy back later. What usually happen is that stock prices are at bottom in a bad big disaster event.

However, many stocks do not behave together with market. For example, Real Estate REIT was hardly affected by 911 event. And many value stocks actually rose during those time because people sold risky stock and baught safer stocks.

In general in the disaster event, my opinion is to look into each stocks carefully, I would not want to panic. Hold on to existing stocks and consider to buy or exchange into stocks that crashed but with no or little fundamental change due to the bad event. Sell the stocks that is fundamentally affected by the bad event.

Typically BIRTP model portfolio is fully invested portfolio. It is not good idea to load up more margin to buy more stocks in a bad disaster event. In that sense, hold on with no action is better choice than buying more loading up more leverage.