Shares and Stirling up

Transalper

Just been browsing through some Money sites, they say Sterling up 4.33 cents on the Dollar and shares up on FTSE 100 205.9.:j
Is it too soon to start investing and celebrating???

soulsaver

It's never too soon to start celebrating...
Given the rise in the DOW last night the ftse rise was predictable..see what the American markets do this afternoon first.

dunstonh

Stirling up....North?

Count_Dante

Read this first:
http://www.telegraph.co.uk/finance/comment/jeffrandall/3275893/The-bigger-the-party-the-longer-it-takes-to-clear-up-the-mess.html

The FTSE has been (sigh) up and down like a tart's knickers.

concisethinker

I must inform you that we use Sterling in Stirling and not US Currency. We even have gas and electricity!!!.

Castleman

Transalper wrote: »

Is it too soon to start investing and celebrating???

If the markets are going up, it's too late to be investing! Well, maybe not too late, but much better to buy the stocks when its finishing falling and cheap rather than already recovered some value.

That's one of the reasons why we're in this mess...everyone saw the housemarkets going up and thought they'd start 'investing' and celebrating! Buy when everyone is selling and sell when everyone is buying etc.

purch

Buy when everyone is selling and sell when everyone is buying

Thats the first mistake amateur Investors make !!!

Buy when the market is rising, and sell when it's falling..........it's a simple rule, but one many who think they can bottom and top pick, or who think they are smarter than everyone else always forget.

Masomnia

Castleman wrote: »

Buy when everyone is selling and sell when everyone is buying etc.

Yeah great strategy, Northern Rock and Bradford and Bingley, anyone?

Just sayin'

rjp_2

The market is looking more confident at the moment, due to expectations of rate cuts. Nevertheless, the market is highly volatile.

Is it better to buy when others are buying, or to buy when others are selling? Both approaches can easily go wrong:

- Stock market bubbles (like the dotcom bubble) are fed by investors who see markets going up and decide to jump on the bandwagon without looking at the fundamental value of the market.

- Trying to oppose the market, and buy when others are selling and sell when others are buying (this is a dodgy paraphrasing of Warren Buffet) is virtually a game of chance, given the unpredicatability of short-term market changes.

Investors are generally poor at timing, and the effects can be quite the opposite of what is intended. Any reasonable investment strategy must take the emotion and guesswork out of the process of buying and selling. Some systems work by having buy and sell signals based on market data. But much of the advice out there is just to buy regularly and hold.

So if you are looking to enter the equities market, consider splitting the investment into several installments over the next year (or make regular installments over the long term). Some may recognise this as a form of "pound cost averaging".

P.S. I've said something similar to this in another thread today:
http://forums.moneysavingexpert.com/showthread.html?t=1240665&page=3
I hope people don't mind me repeating what I said here, given the high risk of putting a lump sum in the market at the moment

Blah99

soulsaver wrote: »

It's never too soon to start celebrating...
Given the rise in the DOW last night the ftse rise was predictable..see what the American markets do this afternoon first.

DOW, DAX and S&P500 are all very slightly down on open now. I think this rise has been played out, a lot of hope is being pinned on an interest rate cut. As I said in another thread I think the FTSE100 will pull back now and eventually drop again before the end of year rise.

rjp_2

Well, the US Fed carried through on the cut in base rate to 1%, so the market might even be in for a rally -- but even the smallest unexpected event could set the markets into a panic again. A good article by John Authers points out something similar on FT.com:

http://www.ft.com/cms/s/0/4aed8bbe-a5e9-11dd-9d26-000077b07658.html