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Feb 17

Buying Stocks in Recession

Posted on February 17th, 2008 by Will Work for Cheesecake!!!

The things that investors fear is losing money in a recession, but how do you make money? I can only tell you that I make more money in a recession than in a bull market. When there is a recession, Mr Market make stocks cheap and at a discounts. The main risk to investor is not in a recession but in the bull market.

You have a greater chance of losing more money in the bull market than in the bear market. Think of yourself buying a Iphone for $600 when it first come out, then 2 month later Apple cut the price to $400. You just lost $200 dollars in the bull market. If you waited for a while when people are not crazy about it, then you would have bought it for $400. The same concept apply to stocks. What is hot today sooner or later be just a common thing.

If you bought Apple stock and held it when the tech burst in the year 2000 at 15 dollars, then you would have made a lot of money because Apple share is in the hundred. The main risk to you is not buying in a recession but buying low quality stocks in the bull market. When there a recession, I witness a lot of good quality stocks being on sale or at discounts.

Anyway, good luck on your investing

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