For almost a better part of a year now, many “big” financial names in the industry have been calling for you to sit on the sidelines, stay in cash, and wait till the markets calm down. While you may decrease the amount of money in the markets, the whole “staying on the sidelines” thinking is absolutely garbage if you ask me.
Somewhere down the line people began to get greedy. This might be a shocker to some, but investing your money in ANYTHING is not supposed to be easy. You may get the hang of it, but that still doesn’t mean it is easy. If we sit on the sidelines what are we supposed to do? Wait until we are in a bull market again and miss 75% of the profits and just lose money on way down again?
The idea that there are no good places to invest in right now, is pretty absurd. You just have to find them, and it really is not that hard. Back in October I wrote a little write up about possible growth in demand for Netflix (NFLX). In short, the article covers how I felt more people would stop going out and/or subscribing to cable and use sites like Fancast to watch television shows online and Neflix to watch movies.
Guess what? Since then Netflix stock has gone from $22 to $42. Was my theory really hard? No. In fact, there really wasn’t any research to it. Combining just common sense and technical analysis I was able to find a stock that saw 80+% returns when the Dow saw -16%.
Sure, it won’t always be that easy, but, for the most part, that is how investing works: you have a hunch, do a little research, and develop a business plan.
In the case of Netflix, I had a hunch about growth of demand for Netflix, I did some research on the company, and then used technical analysis to come up with my plan on investing in the stock.
The way to make the most money is to find the trends before they actually happen. Find possible trends based on what you come across from day to day or what you hear in the news, look for stocks related to your area of interest, and see if the investment is right.
Hey, nobody is forcing you to trade a stock, but if you are serious about increasing your wealth through any type of investment, do you really think you can just wait for somebody to give you a red light or green light?