Sounds like it should be a title for a movie,
doesn’t it? With all seriousness though you can and should be using this strategy especially in a nasty bear market. Lets face it, who really knows when we are at the bottom? Stocks that look like a bargain today can have their values halved in a short period of time. Does that mean you sit on the sidelines and wait for a recovery? The answer is yes, but that is a lot easier said than done. Very few people will invest at the bottom of the market. In fact most people wait till it’s too late to get into the market. With this simple plan you wont have to wait, and you wont have to worry about whether you purchased the stock too early or should have waited. If you follow the strategy as outlined you will be able to purchase a stock at a discount to the current market price and if not still make a return that is above average expectations. Did I get your attention?
A short while ago I wrote Bottom Fishing With the Bears outline a procedure of investing in bad markets. Now I would like to show you another strategy to use for bear market investing, in fact it will work in all kinds of markets as long as you are an investor with realistic return expectations. At this point I would like to urge you to read Bottom Fishing With the Bears, both strategies can be used simultaneously and have the potential to become an important part of your investment planning. Don’t kid yourself serious investing requires planning! Anyone can buy shares in a company but overlook the second and most important part of investing—proper money management.
Bottom Fishing With the Bears used a fictional company trading on the NYSE (New York Stock Exchange) under the symbol DOG. This illustration will use an ETF (Exchange Traded Fund) which is composed of the largest DOG companies in the United States and trades under the symbol (you guessed it) DOGS. Keep in mind that although the stock is fictitious the actual illustration is based on an actual ETF comprised of DOGS and it does trade on a major U.S. stock exchange. We want to keep the strategy as real as possible without giving any specific investment advice. It’s the plan that I would like to focus on and leave the investment decisions and selection in your capable hands. Yes I know I’m stroking you a bit, but since you took the time to read this far you demonstrated that you are open to new ideas an