One year later

Last week marked the one year anniversary of the bear market low.  Money invested last year at this time grew by an amazing amount.  According to Morningstar's indexes, large cap was up 65%, mid caps were up 74% and small caps were up 87% with value stocks beating growth stocks.  Small cap value returned the best results with an increase of 109%.  So what have we learned (if anything).  First, don't panic sell--as that usually happens at the low point in the market.  Second, have a diversified portfolio with plenty of liquidity, by liquidity I mean, money you can get your hands on instantly without having to sell in a lousy market.  Only those with ample liquidity can withstand the claws of a bear market.  There are other lessons but these are the most important--lessons we keep having to learn over and over again.