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Strategies & Market Trends : Analysis Class for Beginners -- Ignore unavailable to you. Want to Upgrade?

To: Arthur Tang who wrote (723)	3/8/1998 8:20:00 AM
From: Arthur Tang	Read Replies (1) \| Respond to of 1471

Economy related investment strategy? Talk to your neighbors and you know the economy. Go to stores and look at the shelves and dust condition on the merchandises and you know the economy. Look at the number of cars in the parking lot and you know the economy. Compare your present job and future, and you know the changes in the economy. You have to know the total amount of 401k money and the effect on Wall street. All the stocks are owned by some one now. When you want to buy with your 401k money; you have to pay more so some one is willing to sell. What this means is that there is enough money out there that the stock you hold will also be bid up later. This phenomenon is called "market broadening". It happens every year. It is seasonal, because vacation money comes out of Wall street. Tax loss selling happens at year's end. Investors selling has to attract buyers by lowering the price of their stock. Short term investors have to be aware of seasonal changes, a broad market view of the overall stock price trend. You can make money doing market timing. When people buy, you sell. When people sell, you buy. That is called a "Contrarian". However, the steady rise of value due to 401k money will put you behind the 8 ball. Once you sell you can not buy back if you want to keep a big profit. Long term investor which is 401k account holder, they just sit tight and make some money each year until retirement. They buy companies that will not go out of business in ten years hence. Market always broadens if the economy is good.