Market Groove

This blog is about  relationship and finance and we've been talking quite a bit about relationship but  with all the movements in the market place the topsy turvy stock markets - the ups and downs and rallying of stocks and mutual fund prices leaves some of us a little shaky.  But why?  we've seen this many times in the past, whatever goes up comes down and goes up again.  The thing is investors sometimes have short memory.  When the market is hot and prices are on the upward move investors have incredible risk tolerance. However, when prices are sliding down suddenly investors are risk averse.  Investors need to shit or get off the pot. 

In a nutshell, this is how it works.  With GIC (Guaranteed Investment Certificates) rates at an all time low there is really no other option than to bite the bullet and invest like a grown up. Research and buy good assets so that when the market is moving in ways that it was made to move you don't panic but sit it out and watch your friends and neighbors and sometimes family members sell their positions at a loss.  You see, this is the typical scenario - buy high when everyone is talking about how great things are like  the way gold  is grabbing investors attention and sell low  when the the price moves down...there is nothing like crystallizing your loss by selling your investment for less than you paid. 

My advice, stop reading the newspapers and turn your television and radio off. Why, because broadcasters are there to sell doom and gloom - to ratchet up the hype about fear, plunder and rape in the market place. You must remember  to keep your head when all about you is losing theirs and blaming it on everything else.

Here is my point.  You don't have to be in the stock market and invest in assets that offer variable returns if you can't take the market volatility.  All you have to do is be prepared to save a hell of lot more of your money. Now if you are like  most people who have used their home as a piggy bank then you know there is no disposable income left you're too buys paying off your debts and no more money to save.  This why you have to invest in the market so that you get some real help from volatility.  That is how the wealthy becomes wealthy and become even more wealthy.


Volatility is the backbone of stock market indices!  If you want to stay on top of things; set up preauthorize contributions on a monthly basis this way you can take advantage of what is called dollar cost average - this is when you buy more of an investment when the price is low and less when the price goes  up and you are amassing units at a reasonable average price.  This way, you are always invested and you never have to worry about market fluctuations and stay up worrying for god sake about your dwindling portfolio.
 
Remember this.  Ships are safe in the harbor but that is not where they belong.  Take a little risk in your life especially if you have many years in front of you or just settle back and resign yourself to working even harder to create wealth.
Take heart, be gentle with yourself and live your best life ever!


Cheers,