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Investing/Strategies / Retirement Investing
|Subject: Re: Questions for a story||Date: 3/22/2004 11:47 AM|
|Author: telegraph||Number: 39938 of 81591|
Why do you think people don't have the "confidence" to invest in stocks? And how much knowledge and experience does it take?
First, in order to have some diversification,so you don't get wiped out by an ENRON, WCOM, or Nortel and lots of other similar companies, you need to own at least 20 different stocks in roughly equal dollar amounts.
You need to track each one carefully, and have a SELL discipline which most folks don't have.
Most folks try to 'buy low' and sell high, but when they hit a peak as in 2001, they panic and sell out AFTER the decline, selling 'low',maybe even lower than they paid, just to 'bail out'. Then they wait too long to re-enter the market because they are 'timid', and miss the lows.
You need to read a Random Walk Down Wall street.
MOst professional managers can't beat the averages, and they spend full time, with a staff behind them, and access to information you don't have, and fail to keep up with simple index funds more than 90% of the time over a ten year period.
If someone who spends 40 hours a week researching stocks can't beat the average, why should the average joe or jane? ???????
Buy the index....
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