The Most Important Question – How Low Will the Stock Market Go?

This of course is a prevalent question with all the volatility that surrounds the stock market today. While some people are shouting get out, others are talking up the market. Of course when it comes to receiving any advice one should always note where the advice is coming from.

There is no question that we face challenging times and as consequence there is more risk involved when investing. With that said, risk often means opportunity. Every new business that starts up has downside risk, yet that does not mean that they should never get started.

We also know that generally the higher the risk the greater the return on investment, if the company makes it. We also know that today there are a lot of bargains to be had. Many stocks are being way oversold and their true value is not being recognized due to the volatility in the market place.

Many people are selling just to liquidize as they need the cash or desire to put their money into more secure sectors. While all this is happening there are unprecedented opportunities presenting themselves?

This is all the more reason to exercise due diligence and not react on every piece of news that comes out of the market. It is better to leave that to the pundits and analyzers, since generally speaking that is their job.

It is hard to know exactly right now how low the market will go, but one thing to remember is this. While we are in a downward cycle there is plenty of evidence to suggest that this will change over time. Hence the use of the word “cycle”.

So if you can invest over the long term then you could be looking at some great returns in the future regardless of weather or not we have hit the floor. As a consequence it may be wise to invest in companies that are financially sound and have produced solid results over the long term.

Source by Benjamin Wise

Add a comment