Stock Market Understanding

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stock market beatAROUND THE NEK – Yesterday’s stock market numbers increased for some companies, but does that mean it’s time for you to invest? According to Edward Jones Financial Advisor in Lyndonville Joseph LeClair, there’s an expanding middle class across the globe, including countries like China and India.


 

“It’s always a good time to invest.” LeClair has worked at Edward Jones for about ten years at this point, and believes in being balanced. For example, it’s not smart to put all of your investment into one stock or industry. Creating a diverse portfolio is important because if all your investment is in one area and that area’s value goes down, so will your profits.

It’s important to understand that a diverse portfolio can be for new or veteran stockholders. LeClair said it’s all about how comfortable individuals are with safe or risky investments. Safe exposure includes investments such as treasury bonds or CD’s (certificate of deposits) that can start as low as fifty dollars.

LeClair also discussed how technology has created a quicker work flow in the field as compared to when he first started at Edward Jones. An increase in technology causes the market to react faster. With a faster moving market Gabe Lambie, New Hampshire Native, believes it can be overwhelming. Even with the availability of information to stockholders or financial advisors, Lambie said, “I usually don’t check the stock market very much. I have applications to warn me once a price goes below or over an expected amount.”

Lambie first got involved in the stock market when he heard people talking about t crashing. “I don’t think easily influenced people should be involved, as the tides of the market tend to overwhelm them when decisions need to be made.” This is extremely important because if an investor looks at the day to day picture, then it’s possible to miss the large growth that’s occurring within a group.

The Dow Jones Industrial Average and S&P 500 are different beasts than individual stocks. DJIA and S&P 500 consist of multiple big corporations that have their own individual stock change individually that impact the DJIA and S&P 500 as a whole. An example is the DJIA could have a net change -21.32 in one day. However, one individual company could have a net change 50.41 on the day. Paying attention to the market as a whole is still important to understand and interpret, but make an individual panic if there’s no reason to worry.