September, 2008 will linger long in the memories of all who are investors in the stock market. Just when things looked like they couldn't get any worse in the wake of the Fannie Mae and Freddie Mac debacles, they did. The so-called "Rescue Package" finally gets signed by President Bush on Friday and the world holds its breath all weekend ...to see how the market will react on Monday morning.
Monday - October 6th..... the bottom falls out and the DOW has its largest single-day drop in history....777 points!
Tuesday, October 7th -- another 800 point drop...but, with a recovery before closing to only 350 points down (for the day). The pundits are now calling it "a bear [within] a bear market!"
Yes, it's discouraging news for investors. But, it's no time to panic. We need to just keep reminding ourselves that everything that goes UP... comes back down, and everything that goes DOWN... comes back up. We might have seen bigger DOWN days than we've ever experienced before, but the Market will pick itself up; It will recover.
Throughout all of it, there is one group of stock market 'players' though, who have smiled all the way. They are the Traders. There are two groups of traders: all of the brokers and managers of mutual funds, hedge funds, etc., and a small group that the Insiders call "retail traders".
Yes...., let me say it once again because most folks don't know this: TRADING, not Investing, is where the ACTION is in the Stock Market. Those brokers and mutual fund managers with the trillions of dollars (most of it in stocks--sitting in the accounts that they 'manage') are the 'big boys'. We little retail traders call them the Elephants. They call us little do-it-yourself guys 'retailers'.
The vast majority of the public only have one concept of the stock market, that of 'investing', i.e., passively turning their (retirement dreams) over to the Insiders, the brokers and mutual fund managers. They, in turn, put together a portfolio of stocks for their client and promise him at minimum, about 10-15% growth appreciation each year. A mutual fund manger can make that promise because history is on his side.
The Stock Market (by itself) has averaged 10-15% growth per year for nearly a century now, through all of the Wars, the Great Depression and even "9-11". So, stocks are a good place to put one's hopes for the future, even though the Investor is probably totally unaware of how his/her manager is really benefiting [personally] from it. If the investor understands 'shorting' and the license he granted the manager when he/she opened the account, they would understand better why mutual fund managers are so willing to work for you for nothing. "No-Load Fund" is the phrase they love to include in their advertisements.
But, what happens when catastrophic events come along like we've seen in September, 2008? Everyone is saying, "Sure wish I wasn't in the Stock Market now!" That is....unless, they are an e-mini trader.
While my many friends in stocks and mutual funds have been in near panic, I and many other e-mini traders have had an absolutely remarkable month! We sit at our home computers with our [normal] everyday goal of making $500 for ourselves, but instead, have seen several days in September of a whole month's profit in a single day, several times.
But, rather than gloat... I get much more pleasure and satisfaction from helping others discover the 'e-mini', like I did back in early 2002. It changed not only my outlook on the stock market, but my whole life.
The last skill set I'll ever need, for the rest of my life. I invite you to check out the 'e-mini'.
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