A good many investors wonder if predicting winning stocks is possible. When a stock is seen to rise strongly one year, the reasonable thing is usually to take for granted that it will continue to do so the next time, right? If the entire market rises well in one year, is it safe to assume it will continue to do the same? When you’re used to witnessing repeating patterns, how tempting it is to think so now, the way we’ve seen everything rally around the last several months. Most don’t move their money around much because they believe in inertia – that things have to as a matter of course move in the same direction they are proceeding in. What these theories would make for is a messed up system.
The Dow Jones Industrial Average, over 100 years old, does act in this intuitive way. About three-quarters of the time the Dow Jones has been in existence, it has reported a rise in the country’s stocks. But it only rose two consecutive years about 60% of the time. The rest of the time, it dropped after a rousing year. This compounds the need to stay financially informed if you have any money invested. Like Warren Buffet, the best stock market strategy is to buy and hold on to a quality company’s stock
The only stock market strategies that are relatively without risk then, involve buying something good, and holding onto it until all the rises and falls, average out. Nevertheless, it is critical that investors stay informed through a WSJ or IBD subscription.
Have you heard of the terms growth stocks and value stocks? These are somewhat crucial in finding a workable theory that you can back up against. Basically, companies that are priced very near to the value of their company are considered to be growth stocks, and stocks that are value stocks are cheap considering the price of the company. All the investment columnists will tell you that growth stocks if they can grow one year, are likely to do so again next year. The Investors Business Daily subscription is an important newspaper for stock market investors and it is geared to giving investors the information, investing tools, and investment training they need to get highly successful in the stock market.
Many well put-together markets like our own always determine their basic level based on a future performance expectation, not anything to do with the past. But there is a somewhat comforting predictability to one part of the stock market – the small cap stocks. These small companies are not all that efficiently treated on the floor; traders advise people to keep their stocks, and not trade them on the slightest hint at the market. Reaction time takes awhile. It takes them a while to react to them. And so, once they begin to move, they stay moving.
If you’re searching for a good strategy, consider investing in top performing stocks ranked high by the Investor’s Business Daily for this year, think about buying up shares in small companies that displayed outstanding performance last year. That is not to say, with today’s changing market condition, you’ll likely decide on bigger cap stocks for the bigger part of your portfolio.. One has to pull the investment trigger based on strong vs. weak dollar future expectation, deflation, goldilocks economy or inflationary leanings.
Staying on top of trends that have an effect on the business climate is the lifeblood of an investor. Be read up from the world’s largest stock market database that helps you discover successful companies before others find out. Monitor the bottom line financial data for companies and industrial groups as well as proportional rankings that give you a decided marketplace vantage. Get an IBD subscription online and you get both the online and print edition for the same price.
Safe investment of money is a topic on many minds and the most sensible path is though staying informed by either reading the IBD or the WSJ.