Fox26 - What Should Investors Be Doing Right Now
Visited with my good friend Mike Iscovitz at Fox26 yesterday to discuss investing in the markets, what is happening with Cyprus and what investors should be looking at in the months ahead. It is always interesting that comments such as "you should be cautious here due to the extreme overbought condition of the market" is somehow misconstrued as meaning be "all in cash."
That is not the case at all. The goal for investors is to "buy low and sell high." However, as we discussed in yesterday's blog post, emotional investing always leads investors to do just the opposite. Since individuals have been programmed by the media to "buy and hold" and "dollar cost average," which by the way NO PROFESSIONAL INVESTOR does, it makes following very simple investing rules impossible to follow:
1) Buy low and sell high
2) Cut losers short and let winners run.
3) Don't lose prinicipal
4) Return OF principal is more important than return ON principal.
5) Spend less than you make and save the rest.
6) Savings are the secret to wealth - refer to rule #3.
7) Chasing performance requires excessive risk taking - refer to rule #4.
8) Getting back to even is not a winning investment strategy.