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Mr Market

April 25th, 2008 at 01:43 pm

I left my corporate job about six years ago to be at home with my daughter. I still have a 401-K with my former employer. I've busy with other things in my life and don't pay too much attention to it. Occasionally I'll look at it a little more closely and reallocate a bit.

My 401-K includes some of my former employer's stock. After talking with other former employees who know current employees I reallocated a portion of that stock to other funds, maybe a year or two ago. From what I heard it didn't sound like things were going all that great.

About a week ago I got the 401-K statement. As I perused the statement I noticed that stocks were down, bonds were up, and my former employer's stock was considerably lower than what it was compared to. Hmm, I thought, either they will go bankrupt in which case my stock probably won't be worth much, or they will get bought out, in which case the stock price is likely to go up. Maybe I should reallocate more of this stock. After I put the statement down I kind of forgot about it.

Fast forward to yesterday. As I read the business section of the local newspaper, I noticed that my former company is being bought by another company, and the stock price of my former company jumped quite a bit.

Just another example of Mr Market being smarter than me, as I read in Broken Arrow's blog the other day. I couldn't predict the future on this, although I think I did come up with the two most likely scenarios. And I kind of surprised myself that I actually know as much as I do.

7 Responses to “Mr Market”

  1. PauletteGoddard Says:

    You worked for SAFECO, Petunia? Until the third paragraph I thought you worked for where I am currently contracting (no names, now, please!)

  2. Petunia Says:

    Now, Paulette, would I "kiss and tell"? Wink The world is a small place!

  3. Broken Arrow Says:

    Hehe, so this is what you meant by asking to quote. Big Grin

    I don't think I caught whether your re-allocationg worked out in your favor or not, but I hope it did.

  4. Petunia Says:

    BA - I honestly don't know if my original reallocation worked in my favor but I felt better. I know, I know, that's a terrible way to make investment decisions!

  5. boomeyers Says:

    It's a gamble, not a science. You are doing fine! At least you pay attention to what you do have.

  6. baselle Says:

    Oooh, how mysterious. So do you live in about the same place as Paulette and I? Big Grin

  7. Broken Arrow Says:

    Petunia, part of investing is having a portfolio that you know you can sleep well at night with. So whatever it was, I'm sure you did just fine. Smile

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