Financial disappointments seem to fill the pages of our daily newspapers a lot lately. National debts are mismanaged, the middle class struggles to pay its bills and market volatility is commonplace. Now seems like a good time to buy and hold a low-risk investment and avoid the ups and downs that characterize the current economy. The timing may seem right to invest now, but is it? Here's a rundown of market timing in stock trading.
Investments are important, whether you're creating a robust portfolio of long-term investments or thinking of a short-term payoff, and you don't want to blow your timing in the next bull market by fearing it will turn out to be a bear. For first-time investors, getting started at the wrong time will leave a bad taste in your mouth and inadequate returns. The old adage says to buy low and sell high, so now's a good time to get in the market, right? Well, sort of.
The stock market was inflated by the reduction of workforce which is not even calculated when it comes to unemployment. There are less people employed than earlier which doesn't make sense when considering population growth and graduates. The economy was propped up by the government and eventually it will deflate. Once that happens, all that money will be gone. There is no new money in the economy; just old money cycled through it. Eventually something will give.
Just be wise about it and you'll do good. Think more about the sector than the economy as a whole. The economy is not going anywhere. The question isn't whether it's a good time to invest it's where is it good to invest. It is good to invest somewhere you just have to notice. Pay attention to trends and think about how people think.
The stock market has been doing very well despite a high unemployment rate and poor consumer spending. Economic data released in late July 2014 shows that consumer spending is increasing and the economy is growing at a 4% rate. Reports also showed thatthe U.S. Economy has added 200,000 jobs a month. If the stock market was doing well prior to this good economic news it should do even better now considering the increasedeconomic output.
The stock market by its very nature swings high and low. The best strategy for long term investing is buy low and sell high. Even though this is common sense there are still people who panic during economic downturn and sell out too early. This is what keeps the economy going.