As you probably know, the stock market has been a bit volatile in the last couple of days. Â And, there is good reason for investors to be wary, because speculation and uncertainty are driving these recent waves. Â Why? Â Well, where everyday investors really don’t have the resources to take advantage of volatility, hedge funds and investment banks are trying to game the market to make huge profits. Â There certainly will be a story or two about great success (or great failure) in the current market.
What can the everyday investor do?
1. Â Stay on top of your portfolio — press your broker for the fundamentals behind your investments and how the market volatility will effect those investments. Â Make sure that any structural change in your portfolio has a good reason and will be sustainable in the long-term.
2. Â Try not to game the market. Â Speculating on the recent waves is a great way to lose a bunch of money. Â If you are speculating, don’t put any more money in play than you are willing to lose.
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