I was poking around on the ASX website's charting tool and noticed something interesting.
The indices peaked in late 2007 and haven't recovered since the end 2008 dip. But the big "reliable" stocks, the banks, woolworths, bhp and so on, never fell as far as the index and so haven't moved much since end 2008.
This makes sense. The money has to go somewhere and I would expect it to go into reliable stocks, keeping their prices up in the process, during a bear market.
So, is there some kind of an index fund that buys the top 200 stocks MINUS the top 10 or so? Seems this would have further to gain in a more optimistic environment?
Obviously I'm talking about the Australian market, but I would be surprised if a similar effect doesn't happen elsewhere.
Also, I am just beginning to learn about this, so please do challenge my assumptions.