This Economy Has Cost Everyone Money
Anybody who has lost money this last year in the stock market may be unsettled. This has been a tough couple of years where almost everyone has come out a loser. The stock market is a place where anybody can look like a fool when it is going down and look like a hero when all stocks are going up.
At times like these it is hard to buy back into the market because of fear but we all know that at some point we need to get back in. Choosing that reentry point is what will ultimately separate the winners from the losers. The people who have the nerve to get back in when prices are low are the ones that will ultimately come out winners.
Averaging down your better holdings is a good thing to do but it can be quite scary too. This is especially so in a market that is in an extended free fall. So, at this time we are really no closer to knowing whether right now is the right time to average down. It seemed a while ago that the stock market had taken a big fall and it might have been the right time to average down some of your better stocks. But then the market continued to fall even further so it would have not worked out if you had invested more.
Although you may want to average down some of the stocks you own, it is important to get some much needed stock diversification as well. Any stock market expert will stress the importance of spreading out your risk between stocks and not putting too much in one stock or a group of stocks. When you put most of your money in one stock or one sector, it is more like gambling in that you are betting everything on one area. Good stock market investing entails figuring out a good variety of stocks that all have an above average chance of going up.
Even if you have been properly diversified, you have most likely lost money in this terrible environment. All investments types have suffered as well as jobs and anything else related to the economy. This will not last forever though, and at some point it will be the right time to get back in. Those that are able to recognize the correct reentry point will stand the best chance of cashing in and actually making money. - 23305
At times like these it is hard to buy back into the market because of fear but we all know that at some point we need to get back in. Choosing that reentry point is what will ultimately separate the winners from the losers. The people who have the nerve to get back in when prices are low are the ones that will ultimately come out winners.
Averaging down your better holdings is a good thing to do but it can be quite scary too. This is especially so in a market that is in an extended free fall. So, at this time we are really no closer to knowing whether right now is the right time to average down. It seemed a while ago that the stock market had taken a big fall and it might have been the right time to average down some of your better stocks. But then the market continued to fall even further so it would have not worked out if you had invested more.
Although you may want to average down some of the stocks you own, it is important to get some much needed stock diversification as well. Any stock market expert will stress the importance of spreading out your risk between stocks and not putting too much in one stock or a group of stocks. When you put most of your money in one stock or one sector, it is more like gambling in that you are betting everything on one area. Good stock market investing entails figuring out a good variety of stocks that all have an above average chance of going up.
Even if you have been properly diversified, you have most likely lost money in this terrible environment. All investments types have suffered as well as jobs and anything else related to the economy. This will not last forever though, and at some point it will be the right time to get back in. Those that are able to recognize the correct reentry point will stand the best chance of cashing in and actually making money. - 23305
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posted by Mr. Forex at
2:49 AM
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