Just when you thought the economy was getting back on track, comes the debt problems of Greece which threatens to plunge Europe back into a recession. Due to the close ties of the global economy, it wreaked havoc on the North American markets as well. However, with the promise of a trillion dollar bailout package from the European leaders, it calmed a lot of the fears of traders. Will this be enough to turn the tide for the long term? Only time will tell.
Watching the market go up and down can have a nauseating for a newbie investor. And that’s why a lot of financial experts recommend taking a long term approach when investing. Now, if you have a financial planner that picks your stock portfolio, you might think that this is all lip service and an excuse for under-performing while holding a bag of losers.
That is why you should actually have knowledge of what you hold in your portfolio and be comfortable with them as long term stock picks. Would you be happy with these companies if the stock market were to close down for the next ten years? That is the question you should ask yourself. In fact, that’s a question that Warren Buffett asks himself too and he’s the world’s best investor.
In order to make money and be able to sleep well in today’s turbulent markets, you need make sure these Warren Buffett stock picks pass the litmus test as long term investments. In fact, instead of being scared of the markets, you should see it as an opportunity to buy some blue chip stocks cheap with the comfort of knowing that because they have intrinsic value, they are bound to rise again.
So while everyone else is worried about when the economy will recover, take comfort in the fact that eventually it will, and you have positioned yourself correctly with long term stock picks (and of course by choosing the best online stock broker to work with).
If you don’t feel comfortable investing in individual stocks, think about investing in ETFs (exchange traded funds) like an inverse ETF, energy ETF or financial ETF.
Interested in trading stock options? Give a look-see at FPT’s post on stock option software.