"Risk comes from not knowing what you're doing." - Warren Buffett
This week's price action was more backing and filling, leaving investors looking at a sideways pattern. The S&P 500 closed at 2,907 on Friday April 12th, and at the end of trading on Thursday, it closed the week at 2,905. So the index sits less than 1% off the highs and up 15+% for the year. As predicted, the indices are now slowly testing resistance at the prior highs. As the days pass, some are getting nervous. However, the message remains the same this week. All should expect that resistance might prove tough to clear the first time it's tested.
"Conviction"
No, I'm not referring to the criminal interpretation, but rather the following definition.
Con·vic·tion - noun, a firmly held belief or opinion. Synonyms - belief, opinion, position, persuasion, idea, stance.
When an investor assembles their plan, and puts that strategy into practice, it has to be done with conviction. Therein lies yet another obstacle for investors. The stock market has a way of challenging these plans and the "will" of investors over and over. December 2018 was the latest example of that.
In the world of investing, conviction can also be defined by the willingness to take risk and express beliefs through a bold course of action to achieve long-term goals. That does not suggest that an active trader strategy is better by simply taking on more risk, but a fair amount of risk is indeed necessary to add substantial value to a portfolio. Like everything else in life, it is all about balance.
More importantly, I believe conviction to an investment strategy can be the anchor that keeps an investor grounded and focused on their plan. Without it, an individual will tend to waffle, change direction with each change of the
What happens next? Confused? The answers to your questions are answered daily at the Savvy Investor Marketplace service. Answers that have been correct during this entire bull market. Not every stock or sector is participating. Money rotation has average investors misunderstanding the stock market's message. Where is money going now?
"STOP making the same mistake over and over. Say goodbye to the advice that has left far too many in a state of confusion. Subscriber reviews speak for themselves. "Great advice and excellent teaching platform." Please consider joining in on our success.
