January 23, 2008 4:42PM

Volatility with a “V”

By Cheryl Casone

Some live for days like these, and others just want to hide their money in their mattress.  You know what category I am in, but I’ve seen so many days like this before, I guess I am somewhat immune.  This is why percentages are so important. 

Do you know what percentages your portfolio is in right now?  Do you have emerging markets, small cap, mid cap, and large?  The more spread out you are through different groups, the more protected you will be.  We are going into a few months of “extreme” volatility.  If you are prone to vomiting on circus rides, this is your dramamine.

Also…..there are two separate events happening right now, one in Washington and one in New York.  Stocks are searching for a bottom, and I don’t think they’ve found it.  For now until they can show us something concrete, the equity market is ignoring the events in Washington.  Yes, the Bernanke rate cut made a difference, but it was a quick shot of Tequila, and we are ready for AA. 

The sober option?  Pick the percentages, and stick with them for the next four to six months.  More tomorrow…..