As an investor, one of the most important things to learn is the word no. There is always somebody pointing to the next great thing and once in a while it is but most of the time is not. Learning to say no to what you invest in, hopefully comes with age or experience. Having said that, as an investor is important to know a little about the trends and you can either watch from a far or having a very small portion of your portfolio be allocated to stocks you take a flyer on. Many will soon be underwater but you will know what to stay away from, which is experience talking to you.
In an article by Saqib Iqbal Ahmed of Reuters, retail investors have continued to buy meme-stocks such as GameStop and AMC Entertainment.
Retail traders’ net purchases of stocks and ETFs totalled $5 billion compared to the one year weekly average of $3.4 billion, JPMorgan strategist Peng Cheng wrote.
Dan Pipen, chief executive of TradeZero noted retail is seeing if speculative trading still works and is trying to catch the high-flyers of the day.
AMC stock went up, however it is important to remember GameStop and AMC are down 52% and 59% from their closing highs from last year. Bitcoin is down 30% and ARK etf is down 56%.
Linking to dividend paying stocks, watching or listening about stocks rallying is a wonderful thing, but if you are a buyer of speculative stocks and they are down 50% that means if you sold you lost half of your money. The number one rule in investing is try not to lose money. One really good way to do that is buy profitable stocks which pay a dividend. The rallies may not be that exciting but if the stocks are up money, your gain last year was a healthy 20% with very low risk. One can not expect to that all the time, but it is better than losing money.
There are more questions than answers, till the next time – to raising questions.