Summer Doldrums or Summer Glee?

By | July 15, 2013

The key to solid investing sounds quite simple in theory, but it is incredibly difficult to do in reality. The overall goal for investors is to find a stock that has a low value, buy it, wait for the value to rise, and then sell it to make a profit. In that one sentence, you get the entire essence of an entire line of work in which brilliant people, such as Scott Reiman, have had a lot of success. However, you can imagine how hard this is to do, so how have they managed it?

What is their secret?

While there are many things that you need to know if you are going to be a successful investor, one of the most important things to understand is the global economy. As the years go by, the world seems to be getting smaller and smaller. People are able to deal with other companies that are located in other countries and even in different continents. Despite this, many businesses work together closely developing products and service.

Parts could be produced in Japan, for example, only to be assembled in the United Kingdom. In this way, the economy of one country can be directly linked to the economy of another country. When the first country starts to struggle economically, it can have a trickle-down effect on the second country. If less parts can be produced, for example, then there are not as many finished products to be assembled. Because of this, consumers are not able to get what they want, and they do not spend their money as freely. They may spend it in other ways, or they may just hold onto it.

Opportunity Strikes?

This means that the economy can begin to look worse, and stock values may dip. However, this dip is not permanent. When the first company begins producing things quickly again, the economies of both countries can rebound, and the stock prices, which are tied to the overall economy, could begin to rise. Those who are very good at investing know how to look for these signs and signals in the numbers.

They can tell when things are shifting and when the economy might be coming back around. They can even tell which specific companies are involved in the process. They can then buy those companies’ stocks while they are still doing poorly, anticipating the upswing, and make a lot of money if they are right and the stock values begin to rise back up again.

Hold on to your Wallet?

With the stock markets wobbling again, some economies are looking ‘spent’ while others are raising their production, it’s hard to figure out which companies are worth looking at, and which are worth avoiding. What stocks are you looking at? What are you selling, too?

Author: InvestorBlogger

Investorblogger.com takes you on a 'Random Walk To Wealth' through money, investing, blogging and tech. We'll explore my insights, mistakes, and experiences together.