The stock market is prone to change heavily, as quick as stocks go up, just as quickly they can decrease again a couple of hours later. For anyone interested in the stock market and stock trade, it is wise to gain a bit of insight into how this market works and is influenced. When looking at the market in a retrospective aspect, we see an almost continuous uptrend. For example, observing the S&P 500 we see an average change of over a 38% decrease in 2008, and since then there have been only positive returns each year. Especially in the last couple of years, markets have risen significantly. What is the right price to buy, if there is any?
Think long-term when it comes to investing
We have been educated about stock market crashes that happened in the past. For example, the stock market crash in 1929 and the Internet bubble in 2001. However, when we look at the total return of the market over a century, there is a significant uptrend. Therefore, it is important to think about the long-term when investing in stocks. Even at all-time highs for certain stocks, the prices could continue to move up. Looking at the long-term options, the past is an important factor. Taking into account how the market progressed over the past number of years could show you how it may continue on over the next years. But always keep in mind that results from the past are not always a guarantee for future results.
Be careful with meme stocks
Meme stocks are all the rage nowadays. Pushed by investors on forums such as Reddit, these stocks do not have the value that is reflected in the stock price. Instead, the price is driven up by communities of investors that encourage purchasing the stock. For example Gamestop, a stock that has been soaring to combat hedge funds after a call-to-action on Reddit after it went short on the stock. Lots of retail investors became rich with these meme stocks, but caution is needed.
Greater fool theory at play
The people investing in meme stocks follow the Greater Fool theory: the assumption that you will be able to sell the stock at a later point in time at a higher price. Inherently to this assumption is the division between the inherent value and the demand of a stock. Do not end up being the greater fool, and do your research when it comes to stocks. Especially if you are aiming for long-term gains.
How a stock tracker can guide you
A stock tracker is an application that allows you to have a holistic view of your portfolio. Such a tracker can help you from various aspects, which include:
- Real-time data on your holdings
Ranging from your stocks to other assets and in some cases even cryptocurrencies.
- Alerts on market changes
Create notifications for stocks. For example, receive a notification when the price moves up or down for over 5%.
- Build your own stock watchlist
You can also save and follow stocks that you think have potential. Set an alert and you will be updated at certain price points to take advantage of a stock price transaction that suits your demands.
Stock tracker for long-term investing
You can leverage these features for long-term investment purposes as well. Naturally, people who have stock trackers tend to look at them quite frequently. Speculation and day trading that is not desirable for people who have a long-term mindset. By setting up alerts about stocks you care about, you do not have to open the tracker for daily fluctuations. This helps you to focus on what matters: long-term returns and compound interest.
Interested to learn more about stock tracking? Delta.app is a leader in the market of stock and cryptocurrency trackers. You can visit their website to learn more about the features and possibilities that this technology provides.