Wall Street and Stock Market Advice for Investors

Investors look toward Wall Street analysts for guidance when they want to create solid Stock Market investment portfolios because shareholders wish to follow the advice of financial experts. The idea of building a portfolio from scratch offers its own appeal, but the monetary fruition of the investor’ personal research offers even greater rewards.

Listen to the experts with a few grains of salt

While it is true that investors need to pay attention to frequent comments offered by professional economists, it is equally true that shareholders need to listen to their own intuitions. Since every person who invests in stocks, bonds, mutual funds or ETFs is a unique individual with personal preferences, it follows that each person’s portfolio ideally reflects the financial predilections that are unique to each individual investor.

The trick to investing involves balancing a portfolio

An unbalanced portfolio contains dangerous risks for the new or advanced investor. If a shareholder only owns two or three stocks, the risk of losing a great deal of money poses a real threat to future financial security. The CEO of a company can make an announcement after the closing of the market on any given day, expressing the sentiment that the business is not making any profits and does not expect to reap profits in the near future. Shareholders who do not have stop losses in place wake up to find that their small portfolios have dropped 60 or 70 percent in value overnight.

Learn a lesson from the dot com bear market

The greatest company in the world experiences periods of losses. The dot com era in the recent past serves as a primary example. During the booming bull market of many technology stocks, every investor thought that the stock prices were going to continue to rise and never bottom out.

Investors do not always heed historical Wall Street financial catastrophes

Unfortunately, those who did not sell their Stock Market shares in time experienced great financial losses. Some of the stock prices of technology companies that were highly favored by top analysts plummeted to unbelievably low prices in an extremely short period. Stocks that were selling at $300.00 and $400.00 per share suddenly dropped to $10.00 and $20.00 per share. People who love to gamble tend to block out these types of bear market occurrences from their memories, but wise investors make sure their portfolios contain diversification. A diversified portfolio can make the difference between encountering severe losses or moderate gains during bear markets.

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