Market Mondays – 9/7/15
Hello my seasoned and aspiring investors! I hope you had a great Labor Day! Yesterday, I had my first contest on Facebook where I gave away a DVD called Generation One: The Search for Black Wealth. This is an excellent documentary on some of the issues our community faces when it comes to accumulating wealth and passing it down to future generations. Passing down wealth is not happening as it does with other races and the DVD does an outstanding job of outlining why and also gives great advice on turning around that vicious cycle. And actually, the advice given is universal in nature so all ethnicities would benefit from it. It was such an eye opener and it ignited an even deeper passion for me to help others get started.
So with that said this segment is going to focus on why you should either have an investment adviser manage your portfolio or get the training and tools you need to do it yourself.
A lot of wealthy people hire Investment Advisers to manage their investment accounts for a small fee. And if you have a good adviser than you are normally making a lot more than the fee you’re paying out. Now, the first thought that comes to a lot of people’s minds is Bernie Madoff….cause he made off with a lot of people’s hard-earned money as their investment adviser before he was caught and thrown in jail. What he did first (as well as what lots of other crooks do) was earn the trust of his prey. He then gets them to give him their hard-earned money….(blank stare). He then comingles the money with everyone else he’s conning and sends his clients bogus statements showing what their money is supposedly doing (another blank stare…) So…..lesson #1 – never give someone your money and expect that they will do right by you. Don’t get me wrong, there are a lot of honest people out there and this rarely happens but you don’t want to ever be in a predicament like this, do you? I’m sure it doesn’t feel good at all and kinda reminds me of how I’ve lent money out never to see it again…but I digress lol. You should ALWAYS have access to your money and be in control of it! Common practice with most Investment Advisers is you open up your investment account(s) which will always be linked to your personal checking or savings account. The only thing the Adviser does is trade in your account and some even have a special set-up with the broker where they are allowed to withdraw the quarterly fee. But again, this is so different from the Madoff situation because you still have full control of your accounts and the statements you receive are as true as they can get.
On the flip side, managing your own accounts is actually a lot easier than you may think. The #1 reason I hear people tell me why they’re not investing is because they don’t understand the stock market. Hey, I didn’t either until about 7 years ago…and I trained myself; so if I can do it, so can you! If this describes you then here is where I come in. For a one-time fee I can get you started and give you the tools you need to be a lifelong successful trader. I also will give you access to expense and forecasting tools that have helped me significantly. The Word says write the vision and make it plain and that is exactly what I did regarding my finances, outlining where I want to be in 5-10 years. For that one-time fee you have gain from me what took years to find out and develop. It’s a small price to pay for something so potentially life-changing. Check out my website for more info at www.legacyinvesting.net.
If you’re already investing and are looking for insight not a lot has changed since last week. The market is doing that up down thingy after the huge drop two weeks ago..lol. Higher volatility (meaning the market is a lot riskier right now and people are kinda scared) is here so we’re having big moves almost every day as we’re staying in a range for now. We ended Friday at 1921 on the S&P 500 and I think we will trade lower before volatility wanes and the market begins moving higher again. The level to watch on the upside is 1970. If we hold above that for some days then the upside chances look better. On the downside 1870, then 1820, then 1680ish could be magnets in the coming weeks or months. For those visual people like myself, here is a 1-year chart of the S&P 500. It may be a bit hard to read but I just wanted to give you an idea of how much technical damage was done with the recent market plunge.
The blue squiggly line at the bottom is the volatility, and the up-trending pink line is the 200-day moving average and is usually a good level of support. We’ve broken so far below it (right side of the chart) that our bull market which started in March, 2009 is definitely in question. A lot of people are saying with the world economy slowing that the US is getting closer to a recession and the coming interest rate hike will not help . I also think a recession is coming but not right now. A recession is defined as two consecutive quarters of negative GDP (Gross Domestic Product) growth and right now, we are still growing. Regardless of what we think, what I’ve learned is to buy when everyone is fearful and sell when everyone is greedy.
Until next week, make it a prosperous one and I wish you many happy returns!
Disclaimer – Legacy Investing & Wealth Management LLC or any of its advisers are not liable in any way for any losses incurred through trading by readers of this weekly blog. Any information or strategies of trading suggested here involve risk of capital loss and this weekly blog is not considered investment advice. Individuals who invest in securities are solely and completely responsible for any and every outcome that may occur.