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How to Deal with Market Bottoms
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Mark Meyerowitz,Owner,
Meyerowitz Investment Management
Mr. Meyerowitz has been investing since high
school, in the 1970s.
After graduating from Brandeis University in 1977; Mark built up his small family business into a large local retailing company.
From the mid 1990s to early 2003, Mark was a broker with Smith Barney and with Edward Jones; two of the largest invest firms in the nation.
Mark and his family have lived in West Orange, NJ since 1987.
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 Every
year the stock market hits a high and a low. The high points
are enjoyable, the low points are very difficult. Currently
it appears that we are at or near one of these low points,
so what should an investor be doing now?
First, he or she needs to control his or her own emotions.
Dwelling on shrunken account values will undermine your decision
making process. Like a great quarterback, you need to be cool
under pressure.
Second, ask yourself if this is the first time the stock market
has hit a low. Of course not. Go back and take a look at the
long term price charts, and pay special attention to the low
points. How long do they last? What did the market look like
be fore it sold off? What happened after the low trading range
ended? One thing to look for: new bull markets start at the
end of market sell-offs and low points. Bull markets begin
when the market is in a miserable mood.
Third, make a buy list of stocks or funds that you would like
to own. A buy list is important because you will have actionable
names to buy when the time comes to act quickly.
Fourth, don't expect a gun to go off to announce the new bull
market. Bull markets often start quietly. It is not a bad
idea to nibble at your favorite stocks, buying small chunks
as the stock rises above resistance points. Paying more for
strong stocks can be much more profitable than buying stocks
that are sinking.
Fifth, and you have heard this before, is have a clear timetable
of when you need your money. Have a realistic time frame.
Rome wasn't built in a day. Remember that setbacks happen,
but the market can make it up really fast once it gets cooking.
In other words, you want to be in the right place at the right
time.
--Mark
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