It's tough being a long term investor.
Everyone is always worried about the short term ramifications and near term events that cause steep fluctuations in the stock market, but really for the most part these aren't a long term investors' concern.
Ultimately, what we want over the long haul is performance, a good rate of return in exchange for taking the pain of volatility and by and large (historically speaking) we get it.
There will be booms, busts, and everything in between, but the longer you stay in the market the better chances you have of earning a positive return, rather than jumping in and out or trying your hand at market timing.
I know, events that have happened recently are unprecedented.
Never before has the financial sector faced a threat quite like this one since the great depression.
The uncertainty has caused a lot of financial turmoil and a decline in most investors' portfolios, but should you get out now? That depends on your tolerance for risk.
If you're willing to stick it out through thick and thin and buy when there's blood in the streets, as there undoubtedly is now, you can come out ahead.
If you're going to bail out the next time the market reacts violently to government involvement or Fed minutes, then you may want to consider what's best for you.
If you're going to stick it out and invest into fear, make sure you understand what you're investing in.
I know Buffett just picked up a stake in Goldman Sachs, but if you can't really understand how Goldman's investment portfolio is currently operating (good luck) then you'll want to stay away until you do.
Also remember to only invest money in the stock market that you're willing to put away for years at a time.
I'm not talking money you need next year, that belongs in a safer investment vehicle.
If you have an investment horizon of 5-10 years, then consider getting into the game (again this will depend on your tolerance for risk, be sure to talk to your own financial advisor about what's a good option for you.
) It's not always easy to look at things with a long term perspective, but if you're looking to make money in a market like this, it's your best bet.
Everyone is always worried about the short term ramifications and near term events that cause steep fluctuations in the stock market, but really for the most part these aren't a long term investors' concern.
Ultimately, what we want over the long haul is performance, a good rate of return in exchange for taking the pain of volatility and by and large (historically speaking) we get it.
There will be booms, busts, and everything in between, but the longer you stay in the market the better chances you have of earning a positive return, rather than jumping in and out or trying your hand at market timing.
I know, events that have happened recently are unprecedented.
Never before has the financial sector faced a threat quite like this one since the great depression.
The uncertainty has caused a lot of financial turmoil and a decline in most investors' portfolios, but should you get out now? That depends on your tolerance for risk.
If you're willing to stick it out through thick and thin and buy when there's blood in the streets, as there undoubtedly is now, you can come out ahead.
If you're going to bail out the next time the market reacts violently to government involvement or Fed minutes, then you may want to consider what's best for you.
If you're going to stick it out and invest into fear, make sure you understand what you're investing in.
I know Buffett just picked up a stake in Goldman Sachs, but if you can't really understand how Goldman's investment portfolio is currently operating (good luck) then you'll want to stay away until you do.
Also remember to only invest money in the stock market that you're willing to put away for years at a time.
I'm not talking money you need next year, that belongs in a safer investment vehicle.
If you have an investment horizon of 5-10 years, then consider getting into the game (again this will depend on your tolerance for risk, be sure to talk to your own financial advisor about what's a good option for you.
) It's not always easy to look at things with a long term perspective, but if you're looking to make money in a market like this, it's your best bet.
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