When you stand on the ocean shore and watch the waves breaking you might become aware that the tide is coming in or going out. It is a slow process to watch the water retreat and when it finally gets to its lowest point it is almost impossible to tell if it has stopped or will retreat further. Plenty of wave action, but going nowhere.
This reminds me of our current stock market. It still looks like the tide is going out because for the last 2 months all the major stock indexes have been inching down. Even the talking heads on CNBC are saying you must be cautious. They would be fired if they told you to sell. How can you tell what is gong on? Almost every analyst and broker looks at the major market indexes ? the Dow Jones Industrial Average, the S&P 500 and the Nasdaq Index. On the surface they look very negative.
The DOW is composed of 30 large companies. The S&P500 has 500 companies of many sizes, but the number (index) generated is weighted by the size of the company. The bigger it is the more it affects the index. And the Nasdaq is smaller companies and have more of the high tech corporations that have been hit so hard and are still having mucho trouble. The professional traders and mutual fund managers relate more to the S&P500. Almost all domestic stock mutual funds have been lower in price for the first quarter.
Even though the S&P has been slipping it is interesting to note that 300 of the 500 stocks that make up the index are HIGHER. Yes, 60% of them have continued to advance, but it doesn't show - yet. When a market is changing directions it is similar to watching the tide stop going out and slowly change. That is what is going on now. The wave action is there, but you can't see that the body of water is now beginning to move the other way.
There are some strong underlying currents such and the Small and Midcap Value stocks, Real Estate stocks, the Leisure group and Financials. This applies to picking individual issues as well as buying mutual funds that specialize in these areas. If you want to be successful ? make money ? in this market you must be with the strongest group so you must switch from weak stocks and mutual funds to those that are currently strong. Fund managers tell you to look at the 3 and 5-year track record and "stay for the long haul". All that does is make money for him, not you. You must find the no-load mutual funds that are going up the fastest during the past 3 and 6-month time period and buy them now.
The only way to Buy and Hold is to buy and hold only while they are going up and to sell them immediately when they start to decline. Don't let the weak stocks or funds carry your cash out with the money undertow.
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
premium house cleaning Highland Park ..As I said in Part I everyone in the insane... Read More
One of the basic laws of physics states that a... Read More
Financial markets provide their participants with the most favorable conditions... Read More
If you were to find that you had some severe... Read More
Are you attracted to the idea of being in control... Read More
It looks like we have now entered a new bull... Read More
During our travel down life's path we come to many... Read More
In November of 2000 when the NASDAQ was trading at... Read More
Cat or dog? Maybe Zebra. Shucks, I don't know, but... Read More
Someday you may want to retire and continue to live... Read More
This article describes the model of a natural relationship between... Read More
Refuse is a serious issue in any society, about as... Read More
Robert Rodriguez likes to buy stocks at their lows. When... Read More
Every day I see in the financial section of newspapers... Read More
Many people would like to diversify their portfolios to expand... Read More
'Sector funds are too risky.' 'I doubled my money with... Read More
A recent cartoon in my daily newspaper showed two guys... Read More
Before they go over the cliff to their destruction these... Read More
The World Bank claims that some two billion of the... Read More
If you are serious about making and keeping money by... Read More
A colleague of mine just returned from a scuba diving... Read More
As a novice trader, you'll often feel the need to... Read More
One of the great "secrets" of successful people is discipline... Read More
I don't know what kind it is, but I saw... Read More
Regardless of the fact that the world's stock markets have... Read More
bedroom cleaning professionals Mundelein ..For the last 12 years we have seen the Japanese... Read More
You'd have had to be living on a desert island... Read More
Every successful trader has a winning system. There are of... Read More
Money: the most charged word in the planet. It means... Read More
The thinking process of the brain relating to the... Read More
How do you make money without picking tops and bottoms?I... Read More
You must take the time once a month to review... Read More
I have been trading for several decades and was an... Read More
Profitable day traders recognize that momentum trading is among the... Read More
The single most expensive stock market trades are those made... Read More
When will the stock market stop going down and start... Read More
As I said in Part I everyone in the insane... Read More
IT'S REMINISCENT OF THE OLD children's tale about an old... Read More
Stock trading can be a very profitable activity. You can... Read More
If you have not back tested your trading system, you... Read More
If you are going to be a winner in the... Read More
If you have been dealing with mutual funds for any... Read More
On Friday or Saturday evening my wife gets a movie... Read More
Over the past few months, several investment professionals have brought... Read More
Before you buy another car you walk around the lot,... Read More
I read a comment by a forum member on another... Read More
In 1960 an engineer working for a watch company in... Read More
When you become interested in a stock or mutual fund... Read More
I feel that an investment strategy in the stock market... Read More
For some "long term" would mean holding a stock position... Read More
Stocks & Mutual Fund |