Be Ready Before the Next Stock Market CrashBe Ready Before the Next Stock Market Crash: news
With the stock market approaching new highs, everything seems to be going right for investors. Yet memories of what happened back in 2008 are still vivid in many investors' minds, and with the market environment having been relatively quiet and crisis-free for more than a year now, smart investors are looking past their greed to look for things that ought to frighten them about their investments, figuring that at some point, a pullback after the market's impressive gains over the past four years is inevitable.
The right time to take steps to make sure you're ready for whenever the next downturn comes is before that market crash actually happens. Below, we'll take a look at some things to do right now, but first, let's take a closer look at what has astute investors worried.
Waiting for the record to buy?
Stocks have had an amazing run in the past four years, with the Dow Jones Industrials (DJINDICES: ^DJI ) having more than doubled and the S&P 500 (SNPINDEX: ^GSPC ) gaining over 125% since their respective 2009 lows. Although the rally has come with some pullbacks along the way, investors have been rewarded for staying the course and buying temporary dips, with recoveries coming quickly and without much cause for alarm. Moreover, levels of concern about giving back those gains are very low, with the S&P Volatility Index's (VOLATILITYINDICES: ^VIX ) measure of investor fear near multiyear lows.
Interestingly, though, the move up in stocks hasn't produced the usual performance-chasing that typically accompanies big bull markets. One reason for that may be that even with these impressive gains, stocks still haven't recovered all their ground from their pre-financial-crisis highs. Until they do, many investors will remain skeptical of the market's long-term health.