Hi db,
Your thread should actually be titled "why are all stocks in the world not insulated from Wall St shenanigans?"
The good news is that you share the thoughts of millions of investors around the world.
Having said this, the average investor will always have significant difficulty in answering the two most important questions in investment decision-making i.e. asset pricing and risk assessment. I could go on for hours about this lack of basic knowledge, however, the bottom line is that most investors shouldn't be buying individual stocks at all.
Moving along, basically, all stock markets are driven by the emotions of fear, uncertainty and greed of the stock market participants (investors), which become very amplified when the stock market has a very bad day i.e. today!
Major sell-offs like today on the ASX, undermine the long-term strategy of most investors (which is why you are pissed off), however, market turbulence will always make the average investor nervous, therefore you are definitely not alone.
At the same time, major sell-offs are nothing new i.e. they are all part of the game. For me personally, I like sell-offs (and major rallies!), as they provide wonderful opportunities for me to enter or exit a stock (which I did today).
In theory, investors should resist the urge to sell a stock based solely on Wall Street's shenanigans (however, as we both know, investors rarely resist this urge as we clearly saw today). Here I am reminded of the quote from Mike Tyson: “Everyone has a plan until they get punched in the mouth.”
Today, 99% of the stock market is driven by "herd" mentality, which can be a good thing, but today, the "herd" was giving investors some very poor financial advice (particularly about CNJ IMHO!), as I think we will see over the coming days, weeks and months.
Turning to CNJ specifically, IMHO, staying the course at the moment, although it might be very difficult emotionally, looks like it could be a very wise choice (this is not financial advice!). This doesn't mean holding on blindly, however, investors should take into account CNJ's current and potentially very rosy future prospects (chiefly the MTJV at the moment).
Having said this, particularly at the moment, global stock markets are very volatile, therefore all CNJ investors should take these current overall and "ever present" dangers and conditions into account.
Finally, sell-offs like we had today are a real test of risk tolerance i.e. the ability to emotionally handle big price swings, as well as risk capacity i.e. the financial ability to take a loss.
In a nutshell, my advice is not to be guided by noise, fear and greed, but rather, to stay focused on the big picture and take the long view.
Best regards.
Please note: This post is not financial advice!
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