The stock market has been going up ever since the dark days of the Financial Crisis. And, many investors have done extremely well. Meanwhile, contrarians have been predicting everything from a market slowdown to a crash for years. Shorting stocks is popular with many who see the market and many individual stocks as ready to tank. The continual stream of market doom and gloom reminds of how the famous American author Mark Twain was reported to have died. He was later quoted as having said, “The report of my death was an exaggeration.” As we noted in our article about shorting stocks, the most-shorted stocks, as a group, went up instead of down last year! Don’t be scared away from profitable investing by the news media or individuals who invested unwisely and lost money. Over the years the U.S. stock market is the best way to grow your wealth. You simply need to know how to proceed.
Don’t Be Scared Away from Profitable Investing
We are not the only ones who have noticed that many potential investors are staying away from the stock market. Jim Cramer of Mad Money blames bears, media for the public’s low interest in stocks.
Don’t let the armageddonists and the negativists and the hucksters scare you away from owning stocks,” CNBC’s Jim Cramer says. “There are vast sums of money to be made here, and far too many people are missing out because they’ve been frightened away from the whole asset class.”
His opinion is that bad news, including bad investing news, gets higher ratings than good news. So, for most potential investors, what they receive is a constant barrage of news that discourages them from investing in stocks.
The other issue is that these folks do not have a clear idea of what to expect and how to find and invest in the best-performing stocks available. They may have invested before based on tips and lost money because they did not know how to assess intrinsic stock value.
Scared Away from Stocks and Investing in Bonds, Gold, or Bitcoins
One of Cramer’s gripes is that there are commentators who profit when their followers invest in asset classes like gold, bonds, Bitcoins, or real estate instead of stocks. While there are good reasons to diversify your investment portfolio, this should be done with a clear head and not be based on panic selling or fear or investing in the first place.
If you want investment advice, you need to stay away from the folks who routinely hype their favorite investments or those who will obviously profit because they are running a pump and dump scheme. This is indeed what happened with the Bitcoin rally and collapse of 2018. And this brings us back to what an investor should expect from investing in any given asset class. A good way to avoid being burned and scared away from profitable investing is to start by investing without losing any money, picking dividend stocks that have been paying dividends for a hundred years, and learning how to do fundamental analysis to find the best stocks to invest in.