If you have been paying attention to the market this year, or even starting late last year, you may have found yourself hearing the same words over and over again. The CPI/Inflation rose to 7.5% for January, highest since 1982, and the Fed is going to speak soon, and blah blah blah.
If you are getting nervous, if you are getting scared that the market may crash or correct and your holdings may go down, step away, and stay away for a little while. This is where you have to start doing your DD or Due Diligence because you shouldn’t be scared. You should be happy to pickup more shares and own more pieces of companies that you believed in. If it’s a solid company, and they aren’t going anywhere, then your money is best left alone. ESPECIALLY if they are a dividend paying company.
I also have to remind myself that when the market looks bleak and all of the news and information you read are negative, it’s time to step back. Let the market and all the participants go crazy, and when it all calms down, see where the bottom may be, and start picking up more shares.
Part of this blog is therapeutic for me. It’s easier said than done to watch that red number, climb higher and higher, and do nothing about it. What would be the point of selling? To lose money? If you don’t sell, you still own the shares. The price could go up, it could double, or triple. If you have done the work and selected good companies, they should be able to emerge, even through the rubble of a “crashed” market.
Personally, I don’t mind red days. Actually, the only red days I do mind, are the ones where I can’t allocate capital to the market. I just think of the bargains or the reduction in average cost that could help when times are good.
Really what I wanted to accomplish in this post was to say, forget about the rate hikes, or the CPI, or the Fed talking, causing the markets to act even crazier. Forget it all, remember you purchased good companies, and bargain prices or lower averages is what we are looking for.
Have a great Friday in this choppy market, have a great weekend where we all can step away. And if you feel you need to sell, remember to ask yourself why did you buy it in the first place.
Let me know your market fears and what drives you crazy!
Thrifty Investing 