I am not an experienced investor at all. I wish I were. Perhaps this is one of the bad economic times and the recession seems to be a global one but should you invest now or track back and take all your money out even at a loss? There are many things that I cannot understand as far as investing money is concerned. Can anyone help me figure that out with some logic and experience after reading my point of view?
First off I am not from a very rich background so all these terms like Mutual Funds, EFTs,401 K and Money Market Savings are kind of new to me. I do have a solid understanding of how these works and what people do to diversify their portfolios. But I have my own point of view and intuition about the market and I have no short term plans.
So wherever I have read about the collapsing economy, credit crisis and recession the best advices seem to be “Take all your investments out and sit on your cash”!! Sounds pretty reasonable as if your investments are in the market especially equities they will loose their value and you will see your investments wiped out!! About right. BUT what happens when you are done with this recession and the market changes from Bear to Bull. Don’t you get all your investments back? I mean still the background info is required with company insight business domain and technical analysis of how well the company does financially but generally speaking I would think more companies do well and the market indices rise. You get more returns to your investments. So to conclude when the chips are down everyone takes their investments out, even cut back their 401 K contribution? Doesn’t sound right to me at all!!
You can make a maximum profit especially in equities if you buy at their minimum and sell at the maximum right but I wish someone could have told me when is the minimum and maximum J . Unfortunaly we never and can’t know that but that’s the job for financial analysts. I read many financial analysts and most of them seem optimistic about the future and YES everyone does admit that we are in one of the worst economic times. So to me this indicates a trading and investing opportunity. Big brand stocks on sale I should say on clearance….. Do you think that every company is going to be eventually bankrupt as we are in recession? The world is going to stop? I really don’t think so. However if you are looking at very short term I think it’s very logical not to invest in the stock market. It’s highly unlikely you get positive returns on your investments and it’s highly unpredictable. There are a number of great companies out there who will set records for profits and growth. And if you happen to be a lucky investor you might be very happy otherwise if the recession is over you will just be happier.
I am not an advocate of compelling you to invest in the stock market and I am certainly not an experienced investor as well. Being from the IT background I know what some IT companies are doing and what is in demand at this point in time … My interest lies with the Technology sector of the stock market and I plan to invest some of my savings in these companies early 2009 and leave the investments for a year and see how I did on my first investment venture. Any thoughts, ideas, plans and observations, corrections are highly welcome. Feel free to comment on my observations, discuss a trading strategy or discuss about the research that I put in for these companies. To be short things I look for to estimate the potential is the business domain, major competition, balance sheet, growth, future prospects, msn ratings, earning estimates for next year and a global presence.
· Adobe (ADBE)
· Ceragon Networks (CRNT)
· Quest Software (QSFT)
· BMC Software (BMC)
· Cognizant technology Solutions (CTSH)
· NCR Corporation(NCR)