3 Phantoms Haunting The Stock Market

And why we're not scared of them --------------------------------------------------------------

Haunting The Stock Market Right Now… And why we're not scared of them. For more confidence in your investing, become a Stock Advisor member today. Act Now! Haunting The Stock Market Right Now… And why we're not scared of them. For more confidence in your investing, become a Stock Advisor member today. Act Now! There's no sugarcoating it (no matter how much you trick or treat) — the stock market has been SCARY the last year.   Wild swings and gut-wrenching tumbles…   We thought we'd pull back the curtain and reveal 3 of the spookiest phantoms haunting the stock market right now… 1. Uncertainty Whether it's political turmoil, a salacious news story, or a global pandemic — any kind of uncertainty can be a boogeyman for your favorite publicly-traded companies. While risk is quantifiable, uncertainty is random. And that's scary for most of us. Except uncertainty is just a short term passing wave in a much bigger ocean.   This is why we don't believe in short term trading to get rich. One bad news story can lead to enough uncertainty to ruin a trade. But as long as one picks solid companies with good underlying fundamentals, the uncertainty will pass over the long-term. 2. Rising Interest Rates As the Fed raises interest rates, we can expect to see a decline in economic growth,  which will have an almost immediate impact on the stock market. Plus, as interest rates rise, yields do as well on things like bonds and Treasury bills, creating more competition for investor's dollars in the short term.   The other part of the equation is rising interest rates mean higher bowering rates for corporations, which can shrink profit margins — this kind of environment really favors companies with no debt and cash on hand.   However, rising interest rates shouldn't scare investors off from buying into a good company — assuming the Fed succeeds in mitigating inflation, interest rates will eventually lower, and investors who get in while interest rates are high, may have gotten bargain bin deals. 3. Investor Panic Perhaps the most infamous and influential of the 3, panic in the market is a reaction to uncertainty, and leads to a widespread selloff due to rumors or just simple overreaction. It's when our emotions override our logic and reasoned analysis.   Almost every single famous market "crash" came about as a result of panic selling. In 1929, panic selling set off the Great Depression. Later, on "Black Monday" in 1987, computer programs automatically liquidated stocks as loss targets were hit, which led to a panic-driven domino effect in the market as investors became more frantic and sold for no other reason than others were selling.   If I'm being truthful, panic selling WILL affect investors who decide to stay strong and hold… in the short term (notice a theme will all three of these?). But those that have the willpower not to sell as their sound investments fall due to panic — and even double down and buy more while prices drop — have often found themselves much richer for it down the road. I personally invest in order to create wealth that can last me comfortably through my whole life. But the irony of it is, that goal often leads people to do irrational things like give into uncertainty and panic sell, often costing them big in the long term.   Which is why I truly believe that Stock Advisor is such a powerful tool to have in your belt. We've weathered market downturns. The Dot Com bubble in the early 2000s, to 2008, and we've STILL managed to beat the market.   In fact, we often doubled down on our favorite stocks, and have seen returns like: Amazon, up 14,661% since we recommended it in September, 2002. Netflix, up 12,597% since we recommended it in Dec, 2004. Apple, up 2,708% since we recommended it Jan, 2008, during the peak of the Great Recession. 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