Financial Fitness

If you have money in the stock market you are probably a little concern with the recent turn of events and sweating it out with the millions of unsophisticated investors in the market.  The sad thing about the current economy is that we were all wondering when the next shoe would hit the fan.  Some people took their money and got out, some dove in head first and made significant gains on the upswing since the crash of 2008/2009 and some sat on the sideline waiting and waiting and waiting.

Well here we are again and where this ride will end no one really knows.  What I do know is that I am not willing to risk my money in a volatile market.  It was Courtney Smith in one of his seminars that said the rich do not play with their money, they believe capital preservation is better than capital appreciation and I could not agree with him more.

In 2008/2009 I didn’t know what I was doing when it came to investing, I knew mutual funds was not the answer for me and decided to try my luck purchasing individual stocks, ETFS and bonds.  The results, I got killed to the tunes of 10’s of thousands and yes I know many people lost in the market but believe me that gave me no comfort what so ever.

Today we are in similar situations but my results are markedly different.  You see I got wise to the fact that I had to go learn some things about the market and how to safely invest (that word is safely) my money.  This time based on the indicators that I was taught to use I got out of the market before the hammer fell.  Did I lose money, sadly I did but I can assure you that a few hundred dollars is a lot easier to part with than the 10’s of thousands from a few years ago.

What you don’t know can and will usually hurt you.  Contrary to popular belief ignorance is not bliss.  Do your research and if you can’t find the time make sure you find someone who can assist you avoid the slaughter on the streets.

Build a protective shield around your wealth

I am a real estate investor to the core but I do enjoy profiting when the stocks I own do well. This provides equity for me to purchase more properties.  I now have the strategy and the tools to do things the right way and preserve my principal by selling my losers and riding my winners.

Let me share with you a few examples of some of my recent trades.

On July 23^th I bought Fossil (Fosl) at $130.25 per share.  Now my indicators told me Fossil was in a major upswing and would be due for a correction very shortly.  I watched the stock and sure enough my indicator told me to get out on July 29^th.  I was able to get out of the position entirely on August 1^st at $123.76.  I was not happy losing $6.50 per share on that trade.  What would have happened had I ignored the indicators?  Today is August 18^th and Fossil closed the day at $74.24, a 43.7% loss in share price from three weeks ago.

For those of you who are full of life and love your Yoga Wear you know Lululemon has been on a tear of late.  Now my indicators told me at $60.00 per share Lulu was overvalued but I put discipline aside and jumped into the stock.  This is a key note worth remembering “without discipline you can never have success”.  Three days after buying Lulu my indicators told me to sell and I was able to get out at $57.38.  I ended up losing approximately $3.00 on that trade.  What’s the big deal?  Rich people don’t lose money, capital preservation is better than capital appreciation.

I learned my lesson; stay disciplined and follow the rules for trading.  Today Lulu is still having difficult riding this storm and closed at $45.00 even.  I believe I should be celebrating right now because my indicators saved me a whole lot of hurting.

To your success

The Financial Fitness Trainer

Courtney Carroll