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What a start to the 2008 investing year! It’s the first day of the year and we are already 200 points down from last year. I’m sure most of us are looking forward hoping for a good year with growing our retirement savings so news like this is not pleasant!
However, keep in mind that those who prosper from the stock market are either:
- Lucky - Some people happen to buy certain stocks that skyrocket. You hear about the people that bought General Electric 30 years ago or the person who got rich owning Microsoft. It happens to many people but it doesn’t mean you can repeat what others have done if you just follow the steps they took.
- Patient - These people buy when the market is down. They hang on to the stocks they buy because their view is long term. They know that good companies can weather the storm and come out of bad times even stronger than before. This is a more sensible approach and one we recommend here at Money Ning because this method is a proven way of become rich over time.
So what am I saying even though the market is down big today? Remember to keep investing!
Have a great 2008!
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{ 10 comments… read them below or add one }
What a drag! 2008 is going to be a long year for the equities market.
Millionaire: I hope not! My annualized return is pretty bad though!!
I just target to get some earning from adsense..
Ain’t easy but work hard will pay
Just invest for the very long haul and you’ll do fine!
-Raymond
Well the good thing is that using options and technology you can still make money when the market is falling.
I plan on spending more time investing using options for 2008.
Greg
I’ll be updating later today on my blog, but the thing is I’m buying stocks in McDonald’s which tend to rise and fall over the course of time. Earnings are reinvested in more stocks right now. This isn’t the only iron I have in the fire, of course. It’s important to have variety, don’t you think?
eplfan: Off topic but yup hard work will always pay off!
Money Blue Book: We will see. I bought some financial stocks that I will probably disclose soon to everyone so I’m definitely looking long term!!!
Greg: Good luck with options. It just accelerates your earnings and loss potential so be careful!
Ann: You are definitely right in that you need to have variety. Diversification is the only free lunch in investing! It’s not as fun but it sure limits risk tremendously!
We should be celebrating when the markets go down. The more it goes down, the more and more I’m going to try to come up with more cash to get in at cheaper prices. As long as you don’t need the money soon, it’s a good thing that stocks go on sale from time to time, as long as they come back.
Diversification is key, definitely, and it is important to have some income paying securities such as bond funds. When the markets are tanking, it’s nice to have the cash payouts every month or every quarter to reinvest.
Blake: That’s a good point. I’ve bought some financial stocks a few days ago which already tanked quite a bit but I want to buy more as it comes down since they are good companies and will eventually come back.
Next week is a different ball game though so we will see how the market does