The stock market has been in an up trend for more than a year. Almost everyone is feeling good and many believe we are back in the old bull market with the previous high of the Dow Jones Industrial Average just about to be broken.
This could be the case, but what if what we are seeing is all glitter and only has sparkle with no value whatsoever. Any one who tells you he knows is either a liar or a fool. Only the market itself will tell what it is doing and very few take the time to learn its language.
The most important thing about the stock market is the major trend. For the past year it has been up and during that time you should have owned equities ? stocks and mutual funds. Some time in the future it will turn down again (it always does despite what you broker says) and that is when you should sell your equities and keep your money in a money market account. You won't be making much, but it takes a lot more effort to make money than it does to keep from losing it.
Brokers will tell you there is no way you can determine the direction of the market. They are either lying or stupid. It is not that obscure. To mine for gold in the stock market I recommend you look at the Investors Business Daily Mutual Fund Index. Notice that the Index price is currently above the 200-day Moving Average. That penetration occurred in April 2003 and had stayed that way until May of 2004 when it broke down.
When that happened you sold everything and went to cash. It went back up through that 200 line shortly after so you should have bought back into equities. Now you are fully invested again maybe in other equities that are performing better than those you had before. Is this a new gold mine or fool's gold? You don't know yet, but you will learn that the trend is your friend.
If you did sell out your previous stocks or mutual funds you should have looked to see where you want to buy again. There is something called sector rotation that will definitely increase the return on your money. At times the technical stocks and funds do better than the real estate group or the banking group. You should be where the strongest funds are and these you can find with a search on the Internet.
Don't be a fool and try to ride out a weak stock or group. Just a few years ago AT&T was $100 per share. Today it is $15. So much for the widows and orphans; they have lost their gold.
What might seem to be a sure thing can turn into a financial disaster - a fool and his gold will soon be parted. Never take a big loss. Listen to the market and learn to stay with the trend.
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
move in cleaning service Lake Forest ..Hello Inflation, it has been awhile, I see you on... Read More
If you have talked to a stock broker or financial... Read More
If you have been dealing with mutual funds for any... Read More
Have you ever thought of investing? Do you have a... Read More
One of the basic laws of physics states that a... Read More
What the heck am I talking about?It is often said... Read More
There are many good penny stock investments available, which could... Read More
You remember the story about the frog that was put... Read More
Today we are inundated with tons of information about the... Read More
The ABC's of Stock Trading SuccessStock trading success...why is it... Read More
The Dow Theorycharles h. dowcharles h.... Read More
Sidney felt sick as she looked at her latest OptionsXpress... Read More
I mean it when I say that. While plastic silverware... Read More
People are constantly asking me why is the stock market... Read More
As I said in Part I everyone in the insane... Read More
I have a 2-car garage. There are nice shelves on... Read More
Invest in the stock market for the RIGHT reason, using... Read More
If you are going to be a winner in the... Read More
Every broker and financial planner will tell you that you... Read More
Every year I go to the Money Show in Orlando,... Read More
If it walks like a duck, quacks like a duck... Read More
We keep hearing about this bear market and that the... Read More
No, this is not a symbol for some Latin number.... Read More
TOO OFTEN, INVESTORS SIMPLY CHOOSE TO follow the crowd. This... Read More
If you've ever flipped on the television to CNN Financial... Read More
pet-friendly home cleaners Glenview ..I know there are a lot of you out there... Read More
Mutual funds were created with the idea that one person... Read More
It is wonderful to be alive in the information age.... Read More
The stock market can present you with a lot of... Read More
Ever turn down a street, get half way and suddenly... Read More
On Friday or Saturday evening my wife gets a movie... Read More
There are formulas for just about everything, but it has... Read More
From the book 'The Stockopoly Plan' by the author Charles... Read More
When it comes to stock market trading it PAYS to... Read More
What does it mean to short a stock?This means that... Read More
I have a 2-car garage. There are nice shelves on... Read More
How do you make money without picking tops and bottoms?I... Read More
(1) CHK stock price $16.74, NAV $32.5CHK is my favorite... Read More
If you have not back tested your trading system, you... Read More
Four blind men were asked to give a description of... Read More
It has fallen upon the consumer to make our economy... Read More
In 1960 an engineer working for a watch company in... Read More
In one of my previous articles (Investing in the stock... Read More
As an investor you will want to check out any... Read More
(1) Stock Market is Tough Place to Make Any Money... Read More
I have been trading for several decades and was an... Read More
Stocks breakout from properly formed bases everyday but many investors... Read More
It looks like the market is ready to start up... Read More
When an individual investor wants to roll up his sleeves... Read More
When will the stock market stop going down and start... Read More
Stocks & Mutual Fund |