Optimistic advisers, stock losers, and more
A majority of professional advisers think the stock market will be higher in 12 months and that interest rates will remain low, says Naples Asset Management Co., which surveyed investment managers, CPAs, and attorneys in the southeast.
It found that 65 percent of professionals predicted the Dow Jones Industrial Average would gain over 12 months.
Meanwhile, 81 percent said that global oil and gas supplies are peaking and that the next president will have little power over their prices.
Selling a losing stock
One psychological mistake made by investors is to hang onto a losing stock in hope that it will turn around.
Investors can ease some of the pain from selling a loser by doing so near the end of the year and realizing a loss that can be used to offset some ordinary income and some future capital gains.
Tax rules allow you to use the loss to shelter $3,000 in regular income, as well as an unlimited amount of capital gains. Unused losses can be carried forward to future years.
Riskier 401k users
Users of corporate 401k savings plans on average take more investment risk than the teachers and non-profit employees who use 403b savings plans, says the Spectrem Group.
Fifty-two percent of 403b participants told Spectrem their investment philosophies are somewhat or very conservative, compared to 43 percent of 401k participants.