Have you ever noticed the stock market figures in every major daily newspaper? If you were not a stock market investor, they would mean very little or nothing to you. However, if you were a stock-holder, chances are that if you were not on the Internet, you were probably a daily subscriber to the newspaper; just for the sole purpose of monitoring your investment. Such is the life of an investor with a portfolio full of stocks. Wondering everyday how your investment was doing. When your stock was up then you were up, literally and emotionally. But, when it was down, you were down, again both literally and emotionally. Up and down, down and up, up and up, down and down.
The roller-coaster ride ends, when the stock-holder finally sells the stock. When is the best time to sell? The best-case scenario is when the price is up, of course. Buy low and sell high, is the stock market industry’s simple logic. Of course in reality, it does not always work out that way. In fact, the majority of stocks end up losing money for their investors, never to be seen again. When a stock is on a downward trend, investors panic and sell their stock to try to retain as much of their investment, before it collapses all together. In other words, cut their losses. However, while this is happening, the industry experts try to encourage holders of the stock to keep it and not sell it; in case the stock goes back up again. Sadly, in most instances, this does not happen.
Over the course of the recent Western financial crisis, caused mostly by major financial institutions and their ill-advised investments, millions of investors lost trillions of dollars in the global stock markets; when they had no chance to save any portion of their investment. The down-slide happened way too fast. But that is the inherent risk that stock-holders must accept, when they expect that they can make a great investment, just by picking the right stock at the right time. It appears to most, to be more like a guessing game, than anything else. Quite simply, stock market investors try to predict what will happen in the future and capitalizing on it.
In the investment world we operate in, no one can accurately predict the future. Not even the financial advisers or experts. Therefore, it is strongly recommended that you conduct your own research before investing, so that you have a better idea of what’s in store for the future; of your hard-earned money. One thing is for certain, the latest global financial crisis has steered millions of investors away from the unreliable stock markets and now they put there money into more transparent and profitable alternative options. Many people would say investors had no choice but to seek alternative investments, when the previous traditional options have repeatedly failed them, so badly.