“Survive the Sell” (7 Feb. 20222).
In learning about personal finances, I was always taught, “buy low, sell high.” It works For those of us who have used this approach in investing in real estate for a primary residence and investing for the long-term. Such work becomes very clear. It is also clear regarding stock market, insurance, and other concerns for investing.
When the economy goes sour, though, many people panic, as James Royal points out in item 2 in his article. That is a big problem. I have witnessed those who panic during a downward spiral of the stock market. They panic and believe they should get rid of the stock immediately. When they do, they miss the point about “buy low, sell high.” For during a downturn in the stock market, one sells when the prices go down. Instead, one should be “buying low.” Panic leads people in the wrong direction. It’s too late to sell because that should have been done before the downturn. People then need to sit tight and wait for the return of the market and prices heading upward. Of course, even in a downturn, if one happens to have stock which remain high and/or gain in price, they should sell such investments. But there is a risk that one day the price is good and the next day it is not.
Even with real estate, it is tough to figure out when the price has gone high enough and whether or not one should sit still and wait longer. If there are signs of the market going down, of course, sell because the price may have topped out. It is a risk as to which decision, sit still and wait or sell while the price is good.
At this point, though, I am dismayed at the headline, “Survive the Sell.” In so many cases right now, in the stock market, it is likely a bad idea to consider any type of “sell” at all. “Buy low, sell high.”
Nevertheless, it is a good thing for a newspaper to bring such guidelines in personal finance to the forefront. Look forward to more informative articles on the business pages.