Should I buy stocks when the market is crashed?
You should buy the stocks when the Market is crashed. It’s a done deal and making easy money , but to pin point the right moment is always difficult task.
For example, the 2008 October crash dragged the DOW point from 11,400 to 6,600(Early March 2009) . That’s about 5,000 points lost with in 5 months. Now the first sudden drop to 8,400 (-2,000 points!) occurred within the first few days of October. If you have decided to buy stocks at that time, you still advanced 1,600 points right now (Today’s DOW is 10,062). But if you have decided to stay until the March 6th which was the lowest point of DOW (6,626), you could have advanced about 3,500 points! That’s about 53% gain with in 7 months.
There are basically few important things to remember when playing this market.
1. You must monitor and wait for the lowest point of the technical indicators , trading environment , and trader’s sentiments.
2. And once you have the feeling you should buy the strong companies , not penny stocks of course, because only stongest companies can survive the storms. For example , AAPL (Apple) was $82 ,but now it’s $190. That’s more than double.
3. Be patient and don’t be scared and don’t follow the immediate market trends. During the bear market , the emotions are weak and can be easily scared, the market fluctuate too dynamically. Only the patient man can be the rich. Thinking of this as long-term investment .
4. Do not invest all of the money in your bank account. Just invest the amount that you are comfortable with.
I would not recommend for jump into the market at this point. With the past relay of bull markets for the last few months, analysts consider the market is possible to turn short term bear especially with DOW hitting over 10,000. They adivise to be cautious. However, you surely need to be prepared when the time comes.
If you do not have the online stock trading account, you should register and direct deposit some money now. Zecco.com is a great online stock broker with lowest ($4.50 or zero cost) commission. There is no Monthly Inactivity Fee, so even if you do not trade at all, there is no charge at all. So just join now and wait for the right time to come.
