Hi everyone! It’s been awhile since I’ve posted and you might be thinking I’m slacking off or I’m on a summer vacation. Well, it’s quite the opposite! I’ve been grinding through several deals (which I’ll talk about in a future post) and continuing to manage my portfolio. And…I’ve gotten quite a few questions from all of you! So, without further ado, let me tackle them in the very first Q&A edition of Cherry Pickin:
Q: So you’ve said that not only is the market healthy but will also continue to move upward. When should I buy into it and which stocks do you recommend? -Brenda L.
A: If you look at the markets historically, there’s always been dips but the market has always recovered and have beaten its previous highs. Therefore, there’s never really a bad time to buy if your goal is to make solid investments rather than to make quick cash. As for which stocks I recommend, I usually go for ones that have a long history (at least 10 years), that have survived recessions and global economic disasters. I always look for ones that pay a guaranteed dividend, so that’s why I’m always tuned into banks and utility companies (and of course MFC!).
Q: (Re: Are the Markets Too High to Invest In??) The part about investors staying away from politically unstable countries is a great point. Since market confidence is driven by outlook, will confidence in the US diminish with the current political situation, investigations, tweets… drive investors to Britain or other Euro nations? -Greg M.
A: Market confidence can change as government policies and economic conditions change. And for that matter, as a President tweets out his thoughts. But for now and for the near future, knowing that most of the world’s countries are either experiencing economic turmoil, war, political unrest, or facing other problems is a big indication to me that we need to place our money in countries that are safe (relatively speaking) like the US and Canada – and investors are doing just that. It’s evident when you see that the Nasdaq and Dow are hitting all-time highs as the world’s money is pouring into these markets. When other nations stabilize, this could change. Remember market confidence is all relative to other countries.
Q: If I stay disciplined, should I even trust my gut at all? -Bojan D.
A: Trusting your gut may be a good thing…..well only if your gut is telling you to buy into great quality companies. Keep it simple. Most people end up trusting their gut have led them into bad investments and out of good ones. Just think of other areas in your life when you trusted your gut and failed or had an outcome you didn’t expect. Now, what if you had taken your time, researched and made a more informed decision? That’s why discipline is so important.
Q: What can I base my buying/selling decisions on? Like how much should I be buying or selling a stock? -Rachel Y.
A: Great question. My general rule is to not be proactive – that is, trying to predict the market. Instead, be REACTIVE– make your decisions based on your goals, facts, and common sense. Have a plan before you buy and sell. E.g. I’ll buy 10 shares of Apple if it drops to $500/share, or I’ll sell my 15 shares of Apple if it goes up to $1100/share. It’s all based on your plan, and once you have it – stick to it. Why panic if the price drops if your stock is one of the most profitable companies in its sector? I’d buy more if that was the case – because it’s even more at a discount then. Which is why I pray for a market correction, so that I can get the companies I want for cheap cheap cheap. [Also, this is all covered in Wall Street Kitchen. Check it out if you want even more detail and some tasty recipes]
Stay tuned for more posts during the summer as I go over some exciting real estate deals I’m working on. I’ll talk about the ups and downs I’ve experienced and what to watch out for!