Monday, April 14, 2014

How To Play This Market Nosedive

I have read a lot of strategies over the years and the common idea that sticks out is to buy when everyone else is selling and to sell when everyone else is buying.  This may seem obvious but not when the emotions of the market get to you.  It goes against the natural feeling that we all have of self preservation.  Whenever we see a crowd running away from something our own nature is to run with the crowd because there must be something dangerous in that direction.  The strange thing is we have not seen it for ourselves. 


Here in lies the issue.  You must investigate something before you run away from it.  Take the time to research a stock and find out whether the company is being managed well.  Then look at the financials as well as the technical analysis.  Lastly consider the market sector.  Is there still potential growth in this sector and is this company in a strategic position to take advantage of it? When you are confident in the direction of the company, do not worry about jittery fluctuations in the market based on insufficient data and world events.  Consider a drop in the stock price an opportunity to buy that stock on sale. 

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