Thursday, June 18, 2015

What to do with rate news and Greece

It seems like every month there is another macro-economic event that you have to worry about. Earlier in the year oil prices suddenly dropped dramatically, which impacted oil related stocks like CVX, COP, XOM.
Also in the news is another round of concerns about the Greek debt. In the past this always seems to stir up a lot of fear and uncertainty, and usually countries jump in at the last minute to save the day.
Lastly, there is always speculation around interest rates. For years it was the quantitative easing. Then the fed slowly pulling out of the program. And now the focus is on the timing of raising the interest rate.
So what's an investor to do? We can't time the market. But with this cloud hanging over our heads should we wait before we invest more ?  Maybe next week the Greece debt crisis will be over. Maybe the Fed will announce when they will raise rates. Maybe oil will bounce back.  Each of these events could seriously impact the market. If I buy more stocks now, and tomorrow news comes out, I could have bought at an unfavorable price.
While all that is true, I believe that it's best to put money to work now. If the entry criteria for a stock are good, then simply buy it. Don't wait. While some uncertainty could be taken away tomorrow, it is also possible that more uncertainty can come up. Maybe an attack somewhere, a major hurricane, or simply bad economic news. Again, if you focus on companies that have weathered down-turns and have solid fundamentals, then the entry price should not be a big concern. I add companies that I expect will pay me a growing amount of dividends for many years to come. And while I try not to buy them at their 52-week high, I also try to not keep money on the sidelines for too long.
Remember: the best time to plant a tree was 30 years ago, the next best time is to plant it today.

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