Investor’s Responsibility When He Is Alone In The Market
In today’s market environment, the best remedy for this situation is for you to get more involved in your own investing decisions.
The problem is that most individual investors do not have the knowledge, resources, or time to spend doing their own research, stock selection, execution, and position management.
The development and expansion of the internet has solved part of this problem in that the internet now provides timely information and resources, right at the fingertips of the individual investor.
Earnings reports, income statements, balance sheets, charts, graphs, research, chat rooms, and even CEO video conferences are easy to obtain online. Now, investors have all the tools necessary to make their own decisions.
However, for many the problem still exists. Why? Because, all the tools in the world are no good to you, if you don’t know how and when to use them. The truth of the matter is that most investors are not qualified or properly trained to interpret the use of these tools, and are therefore ill equipped to use them in making their own investment decisions.
So now what should investors do? The answer is to find someone to help you help yourself. Not to make your decisions for you, but to assist you in making your investment decisions and to help educate you as to the `how` and `why`.
You need to become more involved, and the first step in the involvement process is education.
Education is the key to successful investing for the
individual investor in the market of the future.
All of us who invest in the stock market know that there are three possible outcomes after we make a stock purchase.
First, the stock can go up and this is generally a good outcome.
Second, the stocks can go down and this is usually a bad outcome.
Third, the stock can go nowhere – which is also generally a bad outcome.
It is bad because not only could you have put that money to use in something with less risk that might have produced a return, but you also incurred commission costs on the way in and out which added to your loss.
So, we see that there are three things that can happen when you take on a new stock position, and two of them are bad.
Now, what if we tell you that by employing a certain strategy correctly, you can improve your chances dramatically?
Instead of having two of three scenarios possibly go wrong, you would have two of three scenarios that could go right. And, the third scenario, the bad one, wouldn’t be nearly as bad.
It can happen by using just one of the many strategies involving teaming stocks with options.
Great, but let’s start at the beginning and build a solid foundation first.