Uncertainty. Dread. Loneliness. Change. Worry. Apprehension. Fear. You’ve probably felt these emotions along with countless others since the government shutdowns. Are people scared? Does this mean it’s the best time to invest?
Your investments have caused you to pay closer attention to the market. You’ve probably watched (with horror) the market go down. And come back up again, at least a little.
Using the S&P 500 as a benchmark for how the market is doing, you may think it has hit bottom and is on the way back up. But if you talk to other investors, are they still scared?
Ben Carlson at A Wealth of Common Sense says, “The stock market has the rare ability to make everyone feel terrible all at the same time.” In his article, he tells how the market can make everyone feel terrible, whether you’re bullish, bearish or sitting in cash.
Many have lost a lot in recent weeks. Does the famous phrase, “Buy low, sell high” apply? Is now the best time to invest? Or do you think you’d better cut your losses and sell low?
In a blog written by Blair Duquesnay at The Belle Curve, she points out, “No one can call the bottom with precision, and now is one of the best times to buy stocks since March 2009.” (Blog posted 3/18/2020)
Some Practical Advice
However, an article posted on Forbes last month gives you the following practical advice.
“Whether it’s March 2020 or back to the blissful pre-march era, the answer to the ‘should I invest’ question will essentially depend on the same set of facts.
- Do you have extra cash?
If you don’t have any extra savings lying around, then you probably don’t need to worry about investing some.
- Do you need this money for anything else in the next few years?
Yes, years. Putting cash in the stock market in hopes of turning a super-quick profit isn’t investing—it’s gambling. This situation is very fluid, and the sad reality is that many Americans who are currently working will lose their jobs, making it even more important to assess your financial resources before investing.
- What else could you do with the money?
You can only spend a dollar once, so it’s important to evaluate all the ways that dollar could be used to provide you with the maximum benefit on a risk-adjusted basis.”
Those questions give you some things to think about. After answering them, you realize you have cash to invest. And it is the right time for you to invest, even if people are scared.
What are your next steps?
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See related article on beating the stock market.
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