Stocks are probably one of the first things you think of when you think of investing. The stock market is a big, well-known path of investing.
But just because something is popular doesn’t mean that it’s the best thing! Stocks, like any investment, come with a set of downsides that any investor would be foolish to ignore. Today, we are going to talk about just how risky the stock market can be.
The stock market is controlled by supply and demand like any other market. That’s just the way it goes in the economy. But the stock market can move fast — way too fast to keep up. This is known as gapping: when the price of a stock falls so fast there is no trading activity in between, and a stop loss won’t protect you when this happens. A stock can crash in a few weeks, if not months, and turnaround at times has taken years to bound back. Remember the 2008 stock market crash? Or how about the 2000 Dot.com bubble? Or are you old enough to remember the 1973-1974 stock market crash? And of course nothing compares to the infamous 1929 stock market crash where people commit suicide. There are so many ways things can go wrong.
If people stop buying iPhones, what do you think your Apple stock is going to be worth? It all comes down to how much the company itself is worth, and that depends on the economy at large. When things start dipping, then stocks go down with them because fear and greed drive the market. You simply can’t rely on some stocks to not flake out on you.
And what about the long term? A company that made, say, the tapes for answering machines might have been doing great in the eighties, but how well do you think they’re doing now? Most companies don’t live to see their hundredth anniversary. The sad truth is that most things eventually become obsolete, and with technology advancing faster and faster by the day, that’s a bigger risk than ever.
So, why not invest in something steady? Something people are always going to need? There are a few things that are simply necessary for human life, and one of those is shelter. Real estate is never going to become obsolete. As long as there are people, those people are going to need a place to live, work, and play. Furthermore, real estate is a relatively stable market — even when it goes down, it doesn’t dip as rapidly or as dramatically as some other markets. Ultimately, the underlying value of real estate rarely disappears as many stocks have done.
If you’re thinking about expanding your portfolio, consider adding real estate. It’s an essential asset you can count on to provide a prosperous future for you and your family.
ABOUT July Ono.
JulyOno.com is a real estate investment company. We have been actively involved in the Lower Mainland area real estate investing for a number of years. Our mission is to provide local housing and commercial workspace to quality tenants while at the same time providing an above average return on investment (R.O.I.) for our investor partners and for ourselves. It is truly a win-win-win way of investing!
July offers her investor partners hands-free investment opportunities. If you are interested to learn how to earn an above-average return on your investment, backed by a solid asset, and without the hassle of being a landlord, please contact July Ono.