If the entire market rises well in one year, is it safe to
assume it will continue to do the same? When you’re used to witnessing
repeating patterns, how enticing it is to think so now, the way we’ve seen
everything rally around the last several months. Most don’t move their money
around much because their minds believe in inertia – that things have to
inexorably move in the same direction they are proceeding in. What these kinds
of ideas would make for is a really sorry stock market strategy.
The Dow Jones Industrial Average, that’s been around for
more than a century, does act in this intuitive way. Nearly three-quarters of
the time the Dow Jones has been around, it has reported a upward move in the
country’s stocks. But it only rose two years, back to back about 60% of the
time. The rest of the time, it fell after a banner year. One has to be read up
on the latest trends and market conditions if they have money invested. Warren
Buffet claim to fame is buy and hold on to a quality company’s stock
The best stock market strategies that are relatively without
risk then, involve buying something good,
and holding onto it until all the rises and falls, average out. Most
important is reading and staying abreast of economic news such as subscribing
to the Investor’s Business Daily or Wall Street Journal.
Have you heard of the terms growth stocks and value stocks?
These are somewhat important in finding yourself a good set of stock market
strategies. Basically, stocks that are priced very closely to the value of their
company are considered to be growth stocks, and stocks that are very cheap
considering the price of the company, are considered value stocks. Most the
investment columnists will tell you that growth stocks if they are on the move,
are probably to do so again next year.
The Investors Business Daily subscription is an important newspaper for stock market
investors and it is geared to giving investors the data, investment training
and tools they need to get highly successful in the stock market.
Many well put-together markets like our own always determine
their basic level based on a future performance expectation, not anything to do
with the past. But there is a somewhat comforting predictability to one part of
the stock market – the small cap stocks. Smaller companies are not all that
efficiently treated on the floor; traders advise people to hold on to their
stocks, and not trade them on the least hint at the market. Reaction time takes
awhile. It takes them a while to react to them. But, on the whole, if they rise
one year, they continue to do the same the following year.
If you’re searching for a good strategy, consider investing
in top performing stocks ranked high by the Investor’s Business Daily for this
year, consider buying up shares in small companies that performed well last
year. However, with today’s ever changing financial complexion, you’ll likely
decide on bigger cap stocks for the bigger part of your portfolio.. One needs
to make investment decisions based on weak vs. strong dollar future
expectation, inflation, deflation or goldilocks economic rumblings.
Staying on top of trends that impact the future of business
is the lifeblood of an investor. Be read up from the world’s largest stock
market database that helps you identify successful companies before others find
out. Monitor the bottom line financial data for companies and industrial groups
as well as relative rankings that give you a decided marketplace vantage. Get
an IBD subscription online and you get both the online and print edition for
the same price
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