http://profitableinvestingtips.com/bond-investing/could-your-investments-lose-30-of-their-value-next-year
Could Your Investments Lose 30% of Their Value Next Year?
Earnings have been driving growth in the stock market. A trade war is developing and we are entering the 9th year of an economic expansion. CNBC writes that 20% earnings growth is not sustainable and predicts that stocks could plummet 20% to 30% next year.
“You could be looking at the first 20 percent-plus decline in the S&P since the financial crisis,” the firm’s chief U.S. strategist said Tuesday on CNBC’s “Futures Now.”
His worst-case scenario is a 30 percent plunge next year.
“Our primary list of concerns is on the earnings front,” Clissold said. “Earnings growth north of 20 percent isn’t sustainable, especially when you’re nine years into an economic expansion.”
Clissold, a secular bull, isn’t calling for a major, drawn-out recession. Nevertheless, he said he’s on bear market watch due to warning signs indicating a tired bull market.
So, could your investments lose 30% next year due to a tired bull market, trade war, and wavering investor sentiment? What kinds of investments are at risk? And what are safe investments to hold today?
Safe versus Risky Investments
Any stock that is still going up in price based on investor optimism needs to also have strong intrinsic value or it will end up causing a 30% loss or worse. Last spring we asked what can you invest in and not get hurt by a trade war.