Every Now And Then The Best Movement Is Standing Still
As we have covered before, we are about to come into a solid rally. Many people have lost lots of cash in the slump in all sorts of investments and are wondering what they should do from here. If you have not already unloaded those bottomed out stocks, hold on to them. If your retirement money is in any stock linked format, do not even touch it. Stay put and travel the tide back up. Fundamentally, yes, this is a form of timing the market, but sometimes you just have to. You rode the Dow down from 12000 points to 6500 points. Why not ride it back up with the constant stocks. Most of the stocks you hold, if the company has not gone bankrupt, will go back to their original status.
If you have invested in economic organizations that have not already filed for bankruptcy, you are in good form to ride the rally tide back up to prosperity. If you have not by now diversified your 401k to lessen losses, do not worry now, Ride it back up where it was and then make plans from there. With the market at such a low and stocks that were on one occasion in the double digit dollar figures a share currently trading for pennies, this is the time when everybody and their mom will start to buy.
Sure, read that Wall Street Journal copy that was on your front terrace this morning. Check your IRAs, your 401k plan, and the stocks you are currently holding. The single thing you need to remember is that what you are reading is the lowest your investment will likely go. As mentioned in previous articles, “a growing tide lifts all boats,” and your ‘boat’ will definitely rise with the approaching tide. If you fail to spot a major value incline now, it could be very devastating. Why lose so much value now and sell so low when you can just recuperate the value.
Of course a downturn is hard. This only occurs every twenty years, just like any cycle you will find in any industry or any part of life. As hard as it may be to hang on, this is the worst time to sell since we’re at the bottom. Some analysts, who this writer agrees with, actually call this an false bottom. The bottom should not have been lower than a 7000 point Dow Jones average.
Flaring emotions and investors furious with adrenaline and irritation in reality brought the economy to an unnaturally low bottom. Selling in an false bottom is more unwise than words can express. Resist the urge to sell. In fact, if anything, try to buy more. It will lift the overall financial system, doing good for all industries you have your fingers in.
