Returning To Earth Isn't So Bad

Despite a rough six months, promising investments abound

So you thought investing was easy. Five years of 20%-plus gains in the Standard & Poor's 500-stock average, powered by the economy that could do no wrong, conditioned millions of investors to believe that no bet on U.S. markets could ever go awry. Well, the past few months have taken care of that rosy scenario. The bubble in technology stocks burst in March and leveled market averages almost across the board. Experts from Wall Street to MIT are talking about "reversion to the mean"--the disheartening notion that investors who have feasted on double-digit rewards now face a famine of subpar returns for the next several years. Suddenly, investing looks like the tough challenge of spotting elusive winners and juggling risks that you always heard it was back in the old days--say, 1994.

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