Bears and Bulls: Investing Lessons of a Wild Year

By TOM LAURICELLA
WSJ

For investors, 2009 has been a year spanning the full range of emotions, from the depths of fear and panic in early March, to bullishness that verged on euphoria by late summer.

The year's events, coming on the heels of the turmoil in late 2008, provide important lessons for investors about the basics of investing, no matter what direction the markets take into 2010 and beyond.
[Lede] David Gothard

Even though the Dow Jones Industrial Average was flat for the month of October, it's still up 48% from its March low and 11% for the year. And many parts of the bond market have staged massive rallies of their own.

But last week's big stock-market swings -- including Friday's 250 point plunge -- showed there are still big challenges facing investors.

American consumers remain hamstrung by debt, collapsed home prices and a dismal job market. The massive efforts by the federal government to stabilize the economy have inflated the budget deficit, creating worries about future levels of inflation, interest rates and the strength of the U.S. dollar.

Against this backdrop, here are some key lessons to take away from the wild ride that's been 2009:

(More here.)