When Everyone Zigs, You Have To Zag

Yesterday, I watched the market drop over 600 points as investors were unloading their equity out of sheer fear. It’s never fun watching your portfolio drop by tens of thousand of dollars in the span of an hour, and like many, I was tempted to sell just stop the bleeding. But then I reminded myself of a personal investing rule.

When Everyone Zigs, You Have To Zag

Instead of selling, I asked my wife to transfer more funds into our trading account so I could start buying. After all, the market was on sale! You make money by buying low and selling high. However, most investors buy when the news is great and prices are high, and sell when the news is bad and price are falling. It’s pretty hard to make money that way.

I look at a market crash as an opportunity to pick up some cheap stocks. Apple dropped to $351 yesterday. Today, it closed at $374. Those who sold yesterday are kicking themselves today. And the smart investors are thanking them for selling. 🙂