Send via SMS

The Early Point

Tuesday, January 31, 2006

Damn stock market

Okay, so why is it that no matter what I do, I only make like 5% a year on the stock market? Sometimes I hit some, sometimes I don't. It's crazy. I am seriously beginning to believe that the stock market is not the way to go. Why?

  1. Information is not disseminated to people like us before those who can truly profit receive the information. I'm confident of this as I always notice stock volumes rise abnormaly prior to a major release regarding earnings.
  2. Stocks tend to move in small waves. Unless you have A LOT of money in a stock, you may make only a few dollars on a reasonable investment. For example, I may only have $2,000 to invest in a stock. If it goes up by 5%, ive only make $100. Imagine if I had $200,000 invested in that same stock!! You get my point...
  3. Margin is dangerous!! You have the option of paying only 50 cents on the dollar for stocks. The rest is covered by your brokerage institute. However, if the stock goes down, you may get a margin call that you just don't have the cash to support.
It's not that I'm against the market. I've been investing for 15 years. I'm just realizing that with the limited funds that I, and my friends have, the stock market may not be the best way to get ahead....but if not stocks, then what?


Post a Comment

<< Home