Iraqi Dinars. Bad Investment, or Worst Investment?
"Iraq is a US vassal/puppet state. I'm not sure what 500 South Vietnamese Dong were worth in 1972, but today the paper currency is worth $10 in mint condition. I'd suggest blackjack or craps as an alternate ""investment""." "Currency, like gold and other commodities, isn't really much of an investment at all. It doesn't actually generate any return. Its value might fluctuate at a different rate than that of the US dollar or Euro, but that's about it. It might have a place as a very small slice of a basket of global currencies, but most US / European households don't actually need that sort of basket; it's really more of a risk-management strategy than an investment strategy and it doesn't really reflect the risks faced by an ordinary family in the US (or Europe or similar). Investments shouldn't generally be particularly ""exciting"". Generally, ""exciting"" opportunities mean that you're speculating on the market, not really investing in it. If you have a few thousand dollars you don't need and don't mind losing, you can make some good money speculating some of the time, but you can also just lose it all too. (Maybe there's a little room for excitement if you find amazing deals on ordinary investments at the very bottom of a stock market crash when decent, solid companies are on sale much cheaper than they ordinarily are.)" "Once a currency loses value, it never regains it. Period. Granted there have been short term periods of deflation, as well as periods where, due to relative value fluctuation, a currency may temporarily gain value against the U.S. dollar (or Euro, Franc, whatever) but the prospect of a currency that's lost 99.99% of its value will reclaim any of that value is an impossibility. Currency is paper. It's not stock. It's not a hard commodity. It has no intrinsic value, and no government in history has ever been motivated to ""re-value"" its currency. Mind you, there have been plenty of ""reverse splits"" where a government will knock off the extraneous zeroes to make handling units of the currency more practical."
"If the market is reasonably efficient, why wouldn't this become a self-defeating prophecy, with the eventual recovery priced in throughout the whole recession? Eventual, but when?  That is a big unknown.  In fact, even a recovery is not guaranteed.  Japan's long deleveraging process is brought up often enough with regard to our current long and painful economic downturn. Given that the business cycle isn't predictable This is one of the big issues.  If things were predictable, investing would be easy and there probably wouldn't be as much money to be made in it. owning stocks with a short time horizon is generally a bad idea Agreed.  However, it does not mean that this does not happen.  In fact, it happens every day.  It's called day trading.  Also, it is possible to make money that way, else it would not occur.  So, strictly speaking, whether it is a good or bad idea comes down to specific situations. why would anyone buy stocks in the first place if they weren't prepared to ride out a recession if one happens? These things tend to happen at the worst times and they have a way of compounding or piling-up.  E.g. you overextend yourself, the economy goes south, you find yourself jobless and unable to pay the mortgage, you are forced to liquidate some of your positions because you need cold, hard cash. Benjamin Graham is widely quoted to have stated that the stock market is a voting (opinion) machine in the short term and a weighing (fact) machine in the long term.  This may not feel very satisfying to you: but, it is just the way it is. While the dissemination of information may be relatively efficient, the interpretation of that information is quite variable.  It is not easy to put a number to most events.  (By ""put a number"" I mean determine the impact to the balance sheet.) It is a complicated system, with many inputs and many actors, which have varying goals.  While there may be an effective, Zen-like approach to investing, the markets cannot actually be simplified to ""buy low, sell high"" in practice.  Or, more specific to your question ""buy and hold"" is a simple idea, that is not necessarily easy to implement. Prompted by JoeTaxpayer's comment, I went searching for one of my favorite quotes regarding the markets: ""Markets can remain irrational a lot longer than you and I can remain solvent."" -- John Maynard Keynes And, I came across this one, which I think applies quite well to this question: ""The long run is a misleading guide to current affairs. In the long run we are all dead."" -- John Maynard Keynes" Yes it does, I have just had the worst luck with my job search so far. I do need to brush up on my investing knowledge for interviews because I have been out of school for a few months now  Edit: do you work in ny? Any tips on getting me résumé noticed? Make sure to check the language describing the 'discount'. The company may be matching your contribution by 5% instead of a discount.  You will likely be taxed on the match as compensation and your benefit would net to less than 5%.   The next risk is that you've increased your exposure if your company does poorly.  In the worst case scenario you could lose your wages to a layoff and your portfolio to a falling share price.  Investing in other companies will diversify this risk. As for benefits, you get the 5% (less taxes) for free which isn't a bad thing in my book. Just don't put everything you own into the stock.  It should be part of your overall investing strategy. The optimal time period is unambiguously zero seconds.  Put it all in immediately.  Dollar cost averaging reduces the risk that you will be buying at a bad time (no one knows whether now is a bad or great time), but brings with it reduction in expected return because you will be keeping a lot of money in cash for a long time.  You are reducing your risk and your expected return by dollar cost averaging. It's not crazy to trade expected returns for lower risk.  People do it all the time.  However, if you have a pot of money you intend to invest and you do so over a period of time, then you are changing your risk profile over time in a way that doesn't correspond to changes in your risk preferences.  This is contrary to finance theory and is not optimal.  The optimal percentage of your wealth invested in risky assets is proportional to your tolerance for risk and should not change over time unless that tolerance changes. Dollar cost averaging makes sense if you are setting aside some of your income each month to invest.  In that case it is simply a way of being invested for as long as possible.  Having a pile of money sitting around while you invest it little by little over time is a misuse of dollar-cost averaging. Bottom line: forcing dollar cost averaging on a pile of money you intend to invest is not based in sound finance theory.  If you want to invest all that money, do so now.  If you are too risk averse to put it all in, then decide how much you will invest, invest that much now, and keep the rest in a savings account indefinitely.  Don't change your investment allocation proportion unless your risk aversion changes. There are many people on the internet and elsewhere who preach the gospel of dollar cost averaging, but their belief in it is not based on sound principles.  It's just a dogma. The language of your question implies that you may be interested in sound principles, so I have given you the real answer. Aswath Damodaran's [Investment Valuation 3rd edition](http://www.amazon.com/Investment-Valuation-Techniques-Determining-University/dp/1118130731/ref=sr_1_12?ie=UTF8&amp;qid=1339995852&amp;sr=8-12&amp;keywords=aswath+damodaran) (or save money and go with a used copy of the [2nd edition](http://www.amazon.com/gp/offer-listing/0471414905/ref=dp_olp_used?ie=UTF8&amp;condition=used))  He's a professor at Stern School of Business. His [website](http://pages.stern.nyu.edu/~adamodar/) and [blog](http://aswathdamodaran.blogspot.com/) are good resources as well. [Here is his support page](http://pages.stern.nyu.edu/~adamodar/New_Home_Page/Inv3ed.htm) for his Investment Valuation text. It includes chapter summaries, slides, ect. If you're interested in buying the text you can get an idea of what's in it by checking that site out. "The VDE fund is an energy fund so this is a function of recent price changes in oil (and gas, coal, &c).   For example. Lets say last year when oil was $100 per barrel a bunch of companies saw a good return and put $ 100 million into a bunch of leases, boreholes, pumps, &c to return $10 million per year, and the market says yeah, they're all together worth 100M. Now oil is less, maybe $40 per the link.  These exploration companies don't have a lot of labor or variable costs; they are operationally profitable, may have ""use it or lose it"" leases or minimum pumping requirements for contract or engineering reasons.  Lets say the cash flow is 7M so the market values them at 70M.  They still have about 100M book value so here we are at .7 and I believe the scenario in the question.  Nobody would invest in new capacity at this oil price.  The well equipment could be repurposed but not the borehole or lease, so the best use is to continue pumping and value it on cash flow.  If an individual well runs negative long enough and goes bust, either a different pumper will pay the minimum price that gives profitable cash flow, or that borehole that cost millions to dig is shut off and rendered valueless.  The CNBC article says some explorers are playing games with debt to maintain yield, so there is that too. In the ETF, your bet is that the market is wrong and oil will go up, increasing future cash flows (or you like the current yield, taking on the risk that some of these oil explorers could go bust)." "I'll take a stab at this question and offer a disclosure: I recently got in RING (5.1), NEM (16.4), ASX:RIO (46.3), and FCX (8.2).  While I won't add to my positions at current prices, I may add other positions, or more to them if they fall further.  This is called catching a falling dagger and it's a high risk move. Cons (let's scare everyone away) Pros The ECB didn't engage in as much QE as the market hoped and look at how it reacted, especially commodities.  Consider that the ECB's actions were ""tighter"" than expected and the Fed plans to raise rates, or claims so.  Commodities should be falling off a cliff on that news. While most American/Western attention is on the latest news or entertainment, China has been seizing commodities around the globe like crazy, and the media have failed to mention that even with its market failing, China is still seizing commodities.  If China was truly panicked about its market, it would stop investing in other countries and commodities and just bail out its own country.  Yet, it's not doing that.  The whole ""China crisis"" is completely oversold in the West; China is saying one thing (""oh no""), but doing another (using its money to snap up cheap commodities). Capitalism works because hard times strengthen good companies.  You know how many bailouts ExxonMobil has received compared to Goldman Sachs?  You know who owns more real wealth?  Oil doesn't get bailed out, banks do, and banks can't innovate to save their lives, while oil innovates.  Hard times strengthen good companies.  This means that this harsh bust in commodities will separate the winners from the losers and history shows the winners do very well in the long run. Related to the above point: how many bailouts from tax payers do you think mining companies will get?  Zero.  At least you're investing in companies that don't steal your money through government confiscation. If you're like me, you can probably find at least 9 people out of 10 who think ""investing in miners is a VERY BAD idea.""  What do they think is a good idea?  ""Duh, Snapchat and Twitter, bruh!""  Then there's the old saying, ""Be greedy when everyone's fearful and fearful when everyone's greedy."" Finally, miners own hard assets.  Benjamin Graham used to point this out with the ""dead company"" strategy like finding a used cigarette with one more smoke.  You're getting assets cheap, while other investors are overpaying for stocks, hoping that the Fed unleashes moar QE!  Think strategy here: seize cheap assets, begin limiting the supply of these assets (if you're the saver and not borrowing), then watch as the price begins to rise for them because of low supply.  Remember, investors are part owners in companies - take more control to limit the supply.  Using Graham's analogy, stock pile those one-puff cigarettes for a day when there's a low supply of cigarettes. Many miners are in trouble now because they've borrowed too much and must sell at a low profit, or in some cases, must lose.  When you own assets debt free, you can cut the supply.  This will also help the Federal Reserve, who's been desperately trying to figure out how to raise inflation.  The new patriotic thing to do is stimulate the economy by sending inflation up, and limiting the supply here is key." A currency that is strong right now is one that is expensive for you to buy. The perfect one would be a currency that is weak now but will get stronger; the worst currency is one that is strong today and gets weak. If a currency stays unchanged it doesn't matter whether it is weak or strong today as long as it doesn't get weaker / stronger. (While this advice is correct, it is useless for investing since you don't know which currencies will get weaker / stronger in the future).  Investing in your own currency means less risk. Your local prices are usually not affected by currency change. If you safe for retirement and want to retire in a foreign country, you might consider in that country's currency.