Are you panicking yet?

Did you know that panic selling by retail investors (like you and me) is the worst thing you can ever do?

Studies prove that when a retail investor finally gives up and decides to sell his losing stock positions, it is always already late. (Source: S&P, BofA, Merrill Lynch)

 
Panic selling
 

It is the same as with other strategies. Many times you see investors and traders decide to short the market. Inexperienced traders would again have it wrong. Would you short this market now?

If you answered yes, then you are too late to the party. It is not time to be shorting the market, but sit tight, wait for a reversal and then actually buy it.

 

But this post is not about trading this market. It is about regular investors. It’s about you and me as a dividend investor. Not a trader.

 

In my previous post I wrote I was bearish. And I am bearish!

 

And I love to be bearish! I want this market to fall! I want my stocks to go down! I want other stocks to go down! I want more crashing prices!

Why?

Because I can buy stocks I want for less. I can accumulate stocks I already own for cheap!
 

Remember, as a dividend (income) investor you invest for income not the stock future value (growth)! As an income investor all what matters is the income your investments generate and not it’s value, growth or decline.

But even as a growth investor you are probably panicking and selling but you should not. You have one friend on your side in this market battlefield – time. If you invest into good growth companies, blue chips, you will be able to afford weathering this selling.

It is the same and even better with dividend investing. Time is on your side. You invest for next 20 years or more. And in 20 years, who will remember selling of 2016? Nobody.

 





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