There has been a lot of see-sawing in the stockmarkets, most of it due to the geopolitical tensions, with Russia-Ukraine and the tit-for-tat embargoes, then Iraq making things a bit more exciting in the markets. Then there’s also the talk of stocks having been overvalued / overbought and the US markets *which is the mother of all markets, still not having a correction for more than 2 years.
But here’s the question, why oh why? Why is it that for every slide, there is a bounce just as strong?
I’ve posted in this blog last summer, remember, we’ve got to keep the cash working.
And the magical question is, if you get out of your current stock that is performing, where do you put it?
Will cash products give you the return you want? Measly 4% a year (in the highest interest rate country – Australia), who can live on that?
Will gold be it – with slow growth especially outside the US (EU, China) and geopolitical tensions it is getting attention but is the risk worth it with interest rates on the horizon.
Will oil make a good investment? Increased supply is weakening prices although it remains in the high 90’s and is not really cheap.
What sectors in the stock market can still go higher if they haven’t done so already?
I think this article pointing out the slow growth expected in Australia is giving us a lesson in Central Banking 101 — interest rates are going to stay low, maybe for a longer period than expected.
So my current strategy is to stay in my strong stocks, no hedge (meaning I am not protecting on the downside), keep a wide stop, and buy on dips. This bull market may be getting a little tired but there’s money to be made on the upside.
