Stock Investment Strategies for a Sick Market

When I started playing baseball I remember vividly the coach telling me to keep my eyes on the ball. He said, "You can't hit the ball if you can't see it." The same advise applies to stock investments because the market will change. The changes in the marketplace are usually predictable. If you keep your eye on the market you will be able to dodge the high inside pitch like last September. The past year has been a very unpredictable year in the financial markets. But we failed to keep our eye on the ball. So what do we do to survive the market melt-down?

Don't Panic is strategy #1. Don't stay glued to the financial programs on television. Decide what your goals are in a quiet room were there is no distractions. The talking heads on television are meant to increase ratings and they do that by creating controversy even if its just in our minds.

Don't stop investing is strategy #2. Continue to put money in your account every month to take advantage of dollar-cost averaging. This is a no lose technique because you buy more shares when the price is lower and less shares when it is higher. Over a long-term horizon you will make money, but it takes discipline.

Diversify, Diversify, Diversify is strategy #3. Don't put all your eggs in one basket. Buy some financial stocks, some energy stocks, some drug companies, and so on. Spread your risk across different industries to help offset big problems in a sector like banking had last fall. Only overweight a few industries you really believe are posed for growth in the near term.

Never try to time the market is strategy #4. To be successful you must time getting in the market as well as getting out of the market at just the right time. That means being right not once but twice to take advantage of a market increase.

Unless you can see in the future do not try this technique. I promise, you may do it right once or twice, but sooner or later it will catch up to you. You will lose everything you gained and more.

Total Return is strategy #5. Total return of a stock or bond is the amount this instrument pays you plus the underling return on the investment itself. When yo stock or bond are losing money price wise you are offsetting that loss with the interest or dividend payment you receive.

A very conservative strategy total return will help to keep your retirement account ahead of inflation while paying you handsomely during the boom times in the market.

There are five great strategies to keep in mind when investing in today's markets. Having a well thought out strategy and goals will help you remain calm and feel in control.