Ever have one of those sample boxes of candy? Each little piece is beautifully wrapped in colorful foil or decorated with an interesting design. Taste just one. So good! One more. And another. Before you know it the box is empty. Nothing left.
This upmove in the stock market is very tempting - and could leave you with a tummy ache.
All the market "experts" are telling you that the bull market is back and to get your buying clothes on. Open your wallet and get in before it is too late. Mr. Schwab says it is dangerous to be out of the market. There are great values out there. These stocks are so low they can't go any lower. And there is a Santa Claus and an Easter Bunny.
There is one position I do advocate, but most broker and financial planners won't like it. It is called CASH. No broker believes cash is a position. They say you must always be "invested". It seems they have forgotten that investing means making money and another important part of investing means not losing money.
For the last month we have seen the market go up and some of you have seen some of your money come back. Not too much, but some. You want desperately to believe the bull market is back and your winnings will be restored. I sure hope so. Just suppose this is what is called a rally in a bear market and that it will not last. Then what? You don't want to see your investments slip away again, do you? You don't know if it is a good idea to sell now or wait. Your broker won't be any help.
There is a solution. Stay with your stocks and mutual funds as long as they are going up, but sell them if they go down. How? Every Friday after the close you get the settlement prices of your various issues and you then call your broker Monday morning to put in a "Good Til Cancelled Stop-Loss Order" that is approximately 10% below that closing price. As long as the stock is going up you follow this procedure every week and eventually you will be stopped out. Never move your stop down. You no longer have to guess if this is the highest price that your stock will reach. The stock itself will tell you.
Now you have cash and, if you want to, you can buy a better stock or mutual fund that is going up..
When you pick out a new chocolate (stock) do it carefully and don't try to eat the whole box at once. Sometimes it is best to put the box (your cash) away so you can come back to it another day.
Al Thomas' book, "If It Doesn't Go Up, Don't Buy It!" has helped thousands of people make money and keep their profits with his simple 2-step method. Read the first chapter at http://www.mutualfundmagic.com and discover why he's the man that Wall Street does not want you to know.
Copyright 2005
http://www.mutualfundmagic.com; 1-888-345-7870
quick home cleaning Glenview ..In November of 2000 when the NASDAQ was trading at... Read More
When an individual investor wants to roll up his sleeves... Read More
If you were to find that you had some severe... Read More
Suppose your position has made a big move and you... Read More
(1) CHK stock price $16.74, NAV $32.5CHK is my favorite... Read More
AS BUILDERS BEGIN WORK ON THE FREEDOM TOWER in New... Read More
Very few people, even professionals, have heard of the Dalbar... Read More
Even if you don't own any of their stock or... Read More
The stock market can present you with a lot of... Read More
Well maybe that's overstating it a little, but it's certainly... Read More
Now that you have some money burning a hole in... Read More
As one of my regular readers you know I have... Read More
On the 40 year journey through the turmoil of a... Read More
Because you don't feel too sure about which stock or... Read More
Before they go over the cliff to their destruction these... Read More
At some time in your life you have been on... Read More
The stock market has not been very kind to your... Read More
Four blind men were asked to give a description of... Read More
Are you one of those many people who dread reading... Read More
The greatest stock market myth is the idea that investing... Read More
Most stock traders know that momentum trading can be a... Read More
Using Swing Trading Strategies and Technical Analysis when Trading Stocks... Read More
How many people went to a cash position this week?... Read More
As an investor you will want to check out any... Read More
If you're like many investors who squander those small dividend... Read More
scheduled maid service Winnetka ..A 'stock option' is a contract between two parties giving... Read More
Wall Street has been preaching for years and years to... Read More
When you stand on the ocean shore and watch the... Read More
A recent cartoon in my daily newspaper showed two guys... Read More
If it walks like a duck, quacks like a duck... Read More
The recent criminal fiasco in the mutual fund industry is... Read More
One of the big advertising kicks today from mutual funds... Read More
It is wonderful to be alive in the information age.... Read More
"If you don't know where you are going, any road... Read More
If you have been dealing with mutual funds for any... Read More
A colleague of mine just returned from a scuba diving... Read More
The debate rages all over Eastern and Central Europe, in... Read More
When you become interested in a stock or mutual fund... Read More
Let's hope you did not have any of the Enron... Read More
One Saturday morning, while he was sitting at his computer... Read More
There is a famous cliff on the ocean in Acapulco... Read More
Now where have I heard that before? I know. It... Read More
So you're started trading, you bought some positions with your... Read More
If you are serious about making and keeping money by... Read More
Let's go into the details of why non-indexed mutual funds... Read More
It is commonly reported that the stock market averages about... Read More
This is the continuing story of our two imaginary traders,... Read More
Let's say you are interested in this one company. You... Read More
Day trading is all about making buy and sell decisions.... Read More
We learnt the following the hard way! If any of... Read More
Stocks & Mutual Fund |