Its natural that we, humans reacted greatly to the possible bad outcomes that may happen while in the admist of trading stocks or investing in them. This is a common psychology among many people. It is proven that humans reacted greatly when a bad news is announced and reacted onyl half of how he or she reacted when another good news is announced. Whats most important is that, we should maintain our calmness when faced with such news. We should ask ourselves, what is exactly the reason that attracted me to buy this stock in the first place? if the reason still exists, why bother to sell it off, just because of a bad announcement???
What exactly caused recession ? Recession is the cause of continuos printing of the money, causing it to be less valuable as it used to be. When this happens, the price of food went up, people got retrenched just because the employer is cutting cost. Every one is suffering. So in recession , market price will drop drastically, creating a bear market. This is the time to search for bargains.Real Bargains. I mean since the money you are holding on is losing its value, why not juts invest on some stocks that are currently undervalued and stable. Its always better to make some realistic and good investment rather than just holding on to your money which will slowly losses its value as time passes by. I must agree that not all stocks are good and steady stocks. So, I advised that we should all do our " Research " before buying anything in the market. Its always a good thing to do research beofre doing something else.
The worst thing you could ever do in the market is to buy something at a high price ( something over-valued ). If the market crashes, you could simply lost 5% at least. So, the suggestion is that we should always look out for bargains. ( Not cheap stocks) Take this example : We are in the super market buying some groceries. Would you want to buy the groceries at high price or at a bargain price? Of course many of us want to buy the groceries at a bargain price. So in this case , our groceries are actually rather similar to the stocks.Remember this example and you will rarely buy stocks at a high price.
The word Long Term refers to over a long period ( best if forever). This is learned from Warren Buffett, the world best investor. he did that by long term investment and his best time for holding his stocks will be forever. Why bother to hold a stock for such a short period as your profits will be used to pay your broker. Instead of getting richer, it is your own broker making the money. He just helps you with the transaction and yet his earning has tremendously increased due to your frequent trading. So I advised and prefered the style warren Buffett is on as I find that long term trading, your profits will be even more than short term trading which in the end benefits your broker. So do what your heart says, do the way you are better or prefer in. Short term investment may even be a better choice for you if you are very strong in short term investment.
This is the topic on market. The market always have its ups and downs. One way to be rather safe in the market is: Never buy what you don't know or what you don't understand.( Not even if it is just a word!) This is to ensure that you have a clear idea of what you are buying , making yourself even more confident even if there is a great depression or recession. They will not affect you much as
1) You know what you are buying
2) You trust the stock you bought
So this is one way you can make yourself even more clear on what you are doing in the market as a minor mistake can actually cause a great impact. I hope that my message is conveyed to the people who had viewed my past few posts. As this matter is rather important for many of us and this matter may be one of the most important rule in the market.
The first step to get successful in the market is to save. The more you save, the more money will be available for you to invest, not missing a golden opportunity of investment. Saving may seem easy but it is hard in real life and many tend to spend more than what they earn, resulting in more bills and more bills. The first step to saving is to develop saving at young. If you are no longer young, why not start saving now! Controlling your expense will be one way to save. Saving must not neccessary means that you need to save a lot, to save is to keep a sum of money aside for some important use. A savings of a dollar a day may be enough. Within 5 years, you will approximately saved $1825. ( provided you save everyday). So small amount can actually make a huge difference over time. A small amount will eventually accumulate and become great amount. Saving need not neccessary be for investment. It can be for retirement plan or for future use ( eg. medical fees). Therefore, money will also serve as a loyal equipment to satisfy your personal needs and before you need them to be loyal to you, you need to save.
Well... Iam one of the young teens who is obviously of a different breed. Everyone is going on the novel trend but me was obviously engrossed in those books of business men who were believed to be really successful in life. Examples will be like Warren Buffett Or Paul Allen Or Robert Kiyosaki. Their words had indeed inspired me to work harder so that next time I might be one of them. I felt that I had learned best through experience. I often improved or better understood myself through failure. Although I might be upset by my result, I had aways reminded myself that failure is part of success. In order to success, there will or definitely will have obstacles and problems which we will face. So I know that one of my strength is that Iam not really disappointed by failure but failure makes me work harder and makes me reflect on the reasons why I fail. Everyone has their own strength and figuring out your own strength will be a very good step to success. So this is a short introduction of myself.
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