Tuesday, October 5, 2010

What a great day for the market

If you haven't heard today was a great day for the markets.  

NASDAQ +2.36% 
S&P500 +2.09%
DJIA +1.8%. 

 I think it's funny that those who are afraid to invest in the stock market because of its volatility will settle for 1-2% return on their money for a year in a CD or high-yield savings account.  Well I made more than what they make in a year TODAY.  

Of the 12 holdings in my ROTH (not including any options I own), 10 of them were up 2% or more, with 5 in the 3-5% range.  No losers in this account either.

In my taxable account I had 1 loser (it literally lost only $0.70...I think I'll sleep tonight).  Over all that account averaged a 3.5% gain.

It's days like today that make me love the stock market, but you can't get caught up in it all.  You really need to remember to think through each and every investment decision you make.  A lot of people are looking to gold right now because they see how much it has gone up over the past 10 or so years.  Personally I've never been a big fan of gold, but I do think precious metals have their place in ones portfolio (a small, small place).  Putting all your money into one stock, commodity, etc. is gambling.  Earlier this year nobody would have ever thought BP's stock would or could ever take such a big hit, but things happen.  That's why financial advisors always use that crazy "diversification" word...don't put all your eggs in one basket.  Sure you'll win sometimes, but it only takes one accident to drop your basket & crush your nest egg (see what i did there?).  All in all I'm glad to see a great day for the markets and I hope the momentum continues, but I don't see myself throwing all my liquid cash into it right now either.  
Remember...if you want to consistently beat the market you need to see what everyone else is doing then do the opposite.  I'm not trying to be pessimistic about the future I just think people should THINK before they ACT on emotion alone.  
Hope your day was as good as mine...or even better :) 


  1. I'd like to play with penny stocks. I just don't have enough to start up with, and if I lost all of that I'd be on the street. One of these days I will though.

  2. I wish I knew more about it to start playing with it.

  3. I wouldn't recommend penny stocks unless you really know what you are investing in. You'll see a lot of ads online saying how you can make 1000% return on your money, etc. but usually you'll end up losing it all.

    I have had luck in the past though with a couple and I currently own two penny stocks (they are up 100% & 200%, respectively)...didn't invest that much in them to begin with so my other stocks are still more profitable :)

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