LOCAL INVESTORS KEEP LEVEL HEAD.Byline: Enrique Rivero Daily News Staff Writer What goes down must come up, right? That seems to be the attitude among area investors who, far from panicking at Monday's 554-point stock market drop, saw it as an opportunity to gobble up to capture in a mass or in masses; to capture suddenly. See also: Gobble shares in attractive companies they believed were sure to bounce back, say both investors and investment experts. And they were right. The Dow Jones industrial average Dow Jones Industrial Average The best known U.S. index of stocks. A price-weighted average of 30 actively traded blue-chip stocks, primarily industrials including stocks that trade on the New York Stock Exchange. Tuesday regained nearly 61 percent of Monday's losses, jumping ahead by 337.17 points after a day of record-breaking activity to close at 7,498.32. ``There was very little panic and I think most of our clientele kept their heads very well and used the opportunity to buy more of the good quality names in what they already own as well as other good quality names,'' said Charles Christiansen, branch manager for Prudential Securities' Encino office. One investor was Simi Valley Simi Valley (sē`mē, sĭm`ē), city (1990 pop. 100,217), Ventura co., SW Calif. in an oil, fruit, and farm region; laid out 1887, inc. 1969. resident Nancy Sy, a credit specialist with Syncor International in Woodland Hills. She has been investing since 1986. She admits to being initially nervous about Monday's steep decline, which she said pushed the value of her stock portfolio down about 6 or 7 percent. Still, she remained calm because she saw the day's events as a correction to an overvalued Overvalued A stock whose current price is not justified by the earnings outlook or price/earnings (P/E) ratio and thus, expected to drop in price. Overvaluation may result from an emotional buying spurt, which inflates the market price of the stock or from a deterioration in a market. ``Then I thought I shouldn't panic because it's an opportunity to buy,'' Sy said. Acting on her hunch hunch n. 1. An intuitive feeling or a premonition: had a hunch that he would lose. 2. A hump. 3. A lump or chunk: "She . . . , she bought newly devalued de·val·ue also de·val·u·ate v. de·val·ued also de·valu·at·ed, de·val·u·ing also de·val·u·at·ing, de·val·ues also de·val·u·ates v.tr. 1. To lessen or cancel the value of. shares of drug giant Merck & Co. and Amazon.Com Inc., the online book store, and quickly saw both stocks jump by about 2-7/8 and 8-1/8, respectively. She estimated early Tuesday afternoon that she had made a paper profit of $600 to $700 on each of those stocks. Yes, the thought did cross her mind that the market could have continued to spiral downward into Tuesday. However, she by habit thoroughly researches the companies in which she invests and believed the two companies were fundamentally sound. ``I see a good future for these companies, so I think these corrections are just temporary and I believe the stock will go back up to what it's worth,'' she said. In fact, many of today's investors were veterans of the Oct. 19, 1987, crash that saw the market drop 508 points, wiping out more than 22 percent of the market's value, said professor William Jennings William Jennings is the name of several historical figures including:
These people were hardened by their earlier experience and were less prone to panic after Monday's correction. Plus, unlike in 1987, most people today perceive the American economy as strong, he said. It certainly doesn't hurt that Monday's drop was only one-third as strong as the crash a decade ago. ``If (Monday) had been down 22 percent I'm sure people would be a lot more upset,'' Jennings said. Debi Vasques, a stockbroker Stockbroker 1. An agent that charges a fee or commission for executing buy and sell orders submitted by an investor. 2. The firm that acts as an agent for a customer, charging the customer a commission for its services. for Edward Jones Edward, Eddie, or Ed Jones is the name of: Edward Jones:
Companies in general remain in good shape, as does the economy, making for cooler heads and optimism among investors that they were looking at a prime opportunity to buy into companies with solid futures. ``It's not a time to panic,'' Vasques said. Still, there are plenty of pessimists who believe stock prices are higher than their values and still have room to fall to more realistic levels, said Lawrence Harris, a professor of finance at the Marshall School of Business The Marshall School of Business (also known as USC Marshall School of Business) is the business school at the University of Southern California. It is the largest of USC's 17 professional schools. The current Dean is James G. Ellis. at the University of Southern California The U.S. News & World Report ranked USC 27th among all universities in the United States in its 2008 ranking of "America's Best Colleges", also designating it as one of the "most selective universities" for admitting 8,634 of the almost 34,000 who applied for freshman admission . He expects the tension between the optimists and pessimists to make for a ``quite volatile'' market in the near future. ``The optimists are living in the future and the pessimists are living in the past and, truly, neither knows what the future will be,'' Harris said. Meanwhile one person who didn't take advantage of the Wall Street events of the past two days but wishes he had was Jef Schwartz of Glendale. Schwartz, 38, said all his investment money was already tied up in certificates of deposit and technology stocks and that he didn't have any more cash to spare to buy up new stocks. ``If I learned anything from this it's not to be fully invested so I can take advantage when these dips do happen,'' Schwartz said. |
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