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"Look at market fluctuations as your friend rather than your enemy; profit from folly rather than participate in it." -Warren Buffett
It's tough to argue with the "Oracle of Omaha." And Buffett is right: Investor "folly" creates some of the biggest moneymaking opportunities you'll find in stocks.
Just look at the whipsaw-trading we've been seeing in recent weeks, with stocks plummeting one day only to soar the next – all because of the bearish or bullish economic statistic du jour.
When we reach the end of this year, I believe that the tech investors who stayed in the market will see that they've been rewarded for their courage, while those who spent 2014 on the sidelines will be penalized for their caution.
That prediction probably won't make it any easier for you to stomach the roller-coaster moves I expect we're going to continue to see in the near term.
But I do believe my trading strategies will help.
You see, knowing how unnerving volatile periods like this one can be, I put together a short list of trading rules that I use during tough stretches like this. They're based on the strategies I use to guide trades in my paid services – the Nova-X and Radical Technology Profits reports – but I've "tightened" them up a bit to better control risk.
And today I want to share those strategies with you.
I sometimes refer to them as my "Sominex Trading Strategies" – a joking reference to the over-the-counter sleep aid. But the fact is that these strategies will help you sleep at night – and not just because they reduce your risk.
Just as important is the fact that they let you sleep better at night while still being invested.
That means you're still making money. And it also means you're not getting left behind.
Because, let's face it: While navigating a risky market can cause some sleeplessness … getting left behind is a nightmare….
Why I'm Not Worried
Before I detail my strategies, I need to tell you why I believe it's worth staying invested.
And to do that, I need to tell you folks a story… about my accountant.
Several times a year, my accountant gives me a lecture, chastising my wife and me for spending too much money dining out. And she may be right on that point.
I always counter my accountant's arguments by reminding her that we're not horrid spendthrifts – and that we're not alone.
Out here in the San Francisco Bay Area, we've got some great, great restaurants. And those eateries aren't hurting for customers.
It's like that in much of the country. In fact, great restaurants are teeming with customers these days.
So while U.S. consumer spending, which powers 70% of the American economy, advanced at a 3.3% annual pace in the fourth quarter – its fastest pace in three years – the strongest spending growth was for food services, in restaurants, bars, and hotels. Consumer outlays there zoomed 10.2%, the fastest growth in more than 20 years.
Consumers only spend on "luxuries" like that when they're confident. And that supports my belief that stocks will rally this year – with tech stocks leading the way.
Tech firms are the big innovators in this country and are the companies creating and pushing the economic trends that will keep America's economic recovery from bogging down.
Here at the Strategic Tech Investor, we're helping you capitalize on that innovation with a tech-investing system that focuses on growth and that spotlights stocks we believe can double in price for you.
For that to happen, however, you need to keep investing – with confidence. And that means we need to help you deal with the turbulence.
With the following three tech-investing strategies, I believe you'll be able to achieve both those goals.
About the Author
Michael A. Robinson is one of the top financial analysts working today. His book "Overdrawn: The Bailout of American Savings" was a prescient look at the anatomy of the nation's S&L crisis, long before the word "bailout" became part of our daily lexicon. He's a Pulitzer Prize-nominated writer and reporter, lauded by the Columbia Journalism Review for his aggressive style. His 30-year track record as a leading tech analyst has garnered him rave reviews, too. Today he is the editor of the monthly tech investing newsletter Nova-X Report as well as Radical Technology Profits, where he covers truly radical technologies – ones that have the power to sweep across the globe and change the very fabric of our lives – and profit opportunities they give rise to. He also explores "what's next" in the tech investing world at Strategic Tech Investor.
very, very good, michael. thank you. you wouldn't also think of some shorting insurance?
Yes, Ian, we have all heard about shorting, but what is it really, and how does one do it?