Catching a cold is just like having a red stock market portfolio.
No matter how hard you try avoid it, it will find its way to weaken your immune system.
No matter how hard you try to keep your portfolio green, the red sea finds its way to flood the seeds that are starting to grow.
However, it doesn’t matter how many viruses enter your system, or how many red floods wash away the fresh growing weeds in your portfolio because this won’t stop you from thriving, from buying stocks.
Though you sometimes catch a cold or accumulate paper losses, you survive because life is a cycle, a cycle of ups and downs.
Recovery comes after every cold virus infection
When you catch a cold, you will recover after several days.
I don’t know about you but right now I am taking too much hot liquid, taking pills, eating food, having a lot of sleep to shorten my recovery period, and rubbing a Vicks Vapor Rub on my back and chest to help ease my discomfort from my clogged nose.
It’s the same thing with your stock market investment. When the market is down and your protfolio turns red, you make moves to minimize your loss. You may either hold your position, or cut your loss and switch to another better performing company, or average down the buying price of your shares.
The thing is, we should take preventive measures so that the simple cold won’t turn into a more serious illness. Also with your portfolio, to minimize great loss and bankruptcy, precautions should be undertaken.
Don’t Lose Hope In A Down Market
Red stock market portfolio can’t be avoided no matter how hard you try to get away from it but there’s no need to panic because there are ways to minimize your loses and still grab good positions or opportunities even the market is down.
Naturally, whatever goes up, goes down and whatever goes down, goes up.
If I may still go for more chilche’s, “There’s a rainbow after a rain” or “When God closes the door, He opens a window”. However, success in stock market investing does not just depends on hope but it also entails learning, action and patience.
Invest Cautiously By Choosing A Good Company, Starting Small And Buying Shares Regularly
To shield your body from frequently catching cold, the doctors usually advise you to take vitamins, eat healthily, do regular exercises and get enough sleep. And most importantly, to survive a health threatening condition, you must follow these advise regularly.
In stocks, choosing a good company, starting small and buying shares regularly are very important practices of a cautious investor.
By choosing the company with a good track record and durable competitive advantage to invest your money in help you to sleep soundly at night. By putting your money on a Bluechip, you understand that since this company may even outlive you, your money has the least risk to just vanish in the thin air the next morning when you wake up.
By starting small you may lessen the risk to lose more when the market suddenly goes down. And by buying shares regularly you may maximize your gains by maintaining a lower average buying price.
Can you still thrive in a down market?
You can learn more form The Big Fat Fish V4.0
If you are in doubt about waht stock market is, you may have a look at this book, What Is On The Other Side.
A good stock market investor still knows how to make his money grow even the market is not performing well.
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