Alan Greenspan, American economist, who was Chairman of the Federal Reserve made a comment about the over-extended market. He called it "irrational exuberance".
The Australian October SPI futures peaked at 2404. The market started to slide & on the evening of October 19 in Australia the SPI closed t exactly 2000. During that evening the U.S. market collapsed.
Next morning our SPI opened 25% lower @ 1500.
The market fell further & eventually stopped @ 1054.
In total the SPI had fallen from 2404 to 1054, 56%.
The more over-extended the market, the bigger the fall. Just be aware it can happen.
The only CBA shares I have left are 500 I bought in my own name @ $126.85. If I sell I will be up for 100% CGT but it still might be the best option if the CBA share price gets over $150. I have sold over 2000 from my SMSF & will not be paying tax.
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