Wow… stock markets where on sale in October! Will the sale continue in November? We will see…
This stock market decline highlights the difference between « traders » and long term savers. This decline in the market scares “traders” as they usually borrow money to buy and sell shares in a rising market. Of course, when the market has down days, day after day, traders sell at any cost.
On the other hand, long term savers like you and I appreciate the opportunity to buy additional shares at lower prices.
It is important to keep in mind that stock markets are not very precise at determining business value in the short term. For a while shares are way overvalued and then they are way undervalued. That is why as a long-term investor, it is important to not pay attention to this “noise” and just continue on following a savings plan that includes regularly buying shares using an objective decision tool.
Warren Buffet maintains that, “In the short term the market is a popularity contest; in the long term it is a weighing machine”. Therefore, keep your focus on long term goals.
In October, my Stock allocation for 2019 indicated that I had to sell some Procter & Gamble (PG-N) and buy other shares on sale:
AT&T (T-N), 3M (MMM-N), Transcontinental (TCL.A-T), McDonalds (MCD-N) and Lowes (LOW-N).
I added to my existing position of these stocks on days when they experienced significant drops in price.
My Stock allocation for 2019 also indicated that I should sell some shares of Helmerich & Payne (HP-N) at the beginning of the month and then buy them back at month end… 15% cheaper .
Until next month,