Thursday, January 24, 2008

Dealing with the market ups and downs...

Recently the investment portfolio has taken some big hits. I was down about 25% before I decided not to look anymore. Since then I’ve heard bits and pieces of how the market is tanking from the news and lunch time conversations. I think it is recovering a bit today but I’m pretty sure damage is still more than 25%.

My new rule: until I have the time to sit down and assess the situation and do research I should not look at the stock market or my portfolio…too closely.

Reason one: if I look at the rapid decline in my portfolio I might be tempted for some panic selling. Not good. I choose my stocks based on a long term investment time frame. Therefore, they should be ok… eventually. When I have time to look at the portfolio again and I do decide to sell some stocks I’d feel better because I wouldn’t be a rash/emotional decision.

Reason two: I don’t want to do any rash buys either. Somewhere my brain is saying there might be bargains out there. The shopholic in me is saying ‘let’s go shopping!’ However, without looking into a stock in depth it would be an uninformed buy - risky. When I have the time I’d like to come up with a wish list of stocks I want to have. Then buy them when they are selling at a discount.