In previous columns I have written about some helpful hints about sales, marketing and management ideas for business owners. In this column, I am switching gears to talk about investing and trading ideas. Following the equity markets has always been a passion and hobby of mine for many years. I read many books and magazines published by the market experts and most seem to have completely missed the target this time around. It’s times like these that really separate the good analysts from the bad, however this bear has bit everyone exceptionally hard so all is forgiven (sort of).

In the midst of this ever evolving market, I thought it prudent to try to help ease the minds of many investors and retirees that have seen their 401Ks turn into 201Ks or even worse 101ks. In no way do I consider myself a “Guru” or “Professional” investor. My goal here is to just share some ideas, thoughts and some strategies to make some sense of all the mess out there. Many will have heard some of this stuff before, but it always helps and is sometimes comforting to hear it from an “ordinary average guy” in the same boat as everyone else.

Ok, on with some old adages handed down over the years which have in most cases proven to be historically true;

•    Bad markets are always followed by good markets, so hang in there!
•    Buy and hold quality and “dollar cost average” if your good companies are dragged down with the rest of the market for no sensible reason.
•    Patience and positioning in bad markets will pay off in the long run.
•    If you have the nerve, patience and commitment “buy against the headlines” you will do better than the average investor/trader in the long term if you do not “follow the crowd”
•    “Buy in the gloom, sell in the boom” (if you choose to).
•    Nobody has a crystal ball (That really works) so no one really knows where the bottom is.
•    You cannot predict the unpredictable.

In the late 80s, Louis Rukeyser was asked by his son for some post-crash advice. His response is as follows “There is no sure investment; no chance of being right every time. All you have to work with is careful selection, persistent supervision and diversification to cushion your mistakes. Successful investors know themselves and do their own thinking. They do not react to each market fluctuation. They find a good investment and let it pay off.”

On the subject of the last bullet point, there are always going to be differences of opinion. This is what makes the world of investing and trading so confusing for most people in a bear market. Since the future is unpredictable (with the exception of death and taxes as they say) any one opinion can be right. What can be most frustrating for people seeking advice from “professionals” or “experts” is that they are all privy to and disseminating the same information as the other but can come away with completely opposite views.

There are no hard and fast rules in the stock market (except for maybe one, don’t take big losses; you can’t be in the game if you are out of dough). In fact, a case can be made for doing the exact opposite of almost any rule. One thing I do know for sure is that if you did not go to a full cash position a couple of years ago, now is definitely not the time to panic and go to cash. You most certainly will lose out and miss the recovery cycle. Most markets start to recover about six months and without notice before the economy starts to heal.

One thing I want to make sure to mention here is not to be extremely critical of your investment decisions or some of the advice that you may have received from an advisor or broker. The current market and severity of decline is usually an event that one may experience once or maybe twice in a lifetime. Bear and bull markets will always come and go along with recessions and prosperity. However, most will be far less severe than the current one we are in.

Next, some of my personal strategies for the current market – see if you agree!

Glen Moore can be reached at glenm@mlode.com.