10 August 2011

It's a gamble

So, after days of precipitous decline, the FTSE 100 managed a modest recovery yesterday. Is that it? Panic over? Can we go back to our knitting? Well, I doubt it.

I really don't mind the fact that the stock market has fallen. (After all, it is what stock markets do - rise and fall, rise and fall.) But a fall like the one we have just experienced creates room to make profits: we can buy shares cheaply and expect them to rise in value.

The trick is knowing when the market will turn. Invest too soon and risk further losses; invest too late and any profits will be diminished. I intend to leave any further investment until the decline reaches 4,200 or so.

(Unless I see a bargain in the meanwhile ...)

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