Investing- Yet Another Opinion: Young Investor: Trust the Cycle

Wednesday, November 11, 2009

Young Investor: Trust the Cycle

The S&P Index (max) According to Yahoo's Basic Chart:




SPY (max) According To Yahoo's Basic Chart:




The obvious cyclical trend of the S&P 500 and its tracking etfs, specifically "Standard and Poor's 500 Index Depository Receipts" (SPY: AMEX), clearly show that the market travels through high and low points while its value steadily increases. As you can see right now, it is still working its way out of a low. This means there is still value to be earned. From a “trust based” analysis, even if the market is headed for another huge drop, this etf is bound to produce earnings in 5-10 years. 

If you are a young investor like myself, you have nothing but time on your side. It would be wise to buy a few shares of SPY and forget about them, or if your an active investor and the market does drop again, BUY BUY BUY MORE! The etf’s value will rise higher then todays price eventually (be patient). The economy just saw huge losses and, as is with all stocks/etf’s, you want to buy low, sell high. Its a good investment for future, safe, monetary gains.

The world is not going to end in the coming years and neither will the market. Have faith in the index.

and..
...If, by chance, I am wrong: The world will end, the market will collapse, you will not need money and none of this will matter anyway,
and..
...you will not be able to say, "I told you so" either.


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A



**I still think the economy is headed for another downward turn. There is still too much debt present in the market and I am weary about the unemployment rate. BUT I am also a firm believer in trusting the cyclicality of the market and that is where the majority of this post stems from.

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