Can You Afford a 50% Drop
in the Price of Your Stocks?
By Charles Mizrahi
Editor, Hidden Values Alert
Over the years, subscribers, colleagues, and family members have repeatedly asked me this question:
If buying stocks when they are cheap outperforms the benchmarks, why isn’t everyone doing it?
The answer, in a nutshell, is…because most people can’t. They simply don’t have the emotional makeup to stick with it.
By nature, humans are social animals. We tend to travel in herds, especially during periods of uncertainty. Psychologists have referred to this herding mentality as “social proof,” “where people assume the actions of others reflect correct behavior for a given situation.”
Buying stocks when they are cheap sounds like a solid plan. However, for stock prices to become cheap (i.e., decline), the investing climate has to look bleak, negative, and… uncertain.
It is at those times when investors look to the headlines and the last sale of a stock to inform them of the stock’s value.
Exclusive Offer
Are You Collecting $5,000 Profits on Every $10,000 Trade?
Over the last two years, this profit-generating machine has produced 47 double-digit winners in a row – with ZERO losers – and an average return of 49.5% per trade.
To begin collecting potential profits of $5,000 in profits on every $10,000 investment…you’ll need to act quickly.
This special video presentation explains how the service works – and tells you how you can claim your FREE 30-day trial membership today.
Click here to view this important video now.
During the past few weeks, the stock market has been under a dark cloud. Several factors have contributed to the stock market’s decline, but chief among them was the political infighting over the U.S. debt crisis.
Once a compromise was reached on August 1, Mr. Market found other reasons to worry: Lackluster economic growth, debt problems in the euro zone, and concern that ratings agencies will downgrade the U.S. are the latest batch of worries.
These fears du jour have pushed the S&P 500 into negative territory for 2011. Instead of stepping up to buy stocks that are trading cheaply, investors are running for the hills.
Warren Buffett said, “If you can’t take a 50% drop in your stocks, you shouldn’t be investing in them.”
This is because over the short term, investors’ emotions rule the day, and stock prices can disconnect by a wide margin from the underlying worth of the business.
And Buffett should know: Since 1965 when he took over Berkshire Hathaway, he’s seen the value of his shares, where he has 99% of his net worth—fall by 50% three times!
Now you can get a glimpse of why buying stocks when they’re cheap is much easier said than done for most investors.
For Savvy Investors…
This is Like Christmas in August
We are now in one of those times when fear is rising. For those investors who are following my Inevitable Wealth Portfolio approach, this is like Christmas in August. Mr. Market is offering us great bargains.
Right now 14 stocks —almost half of our IWP portfolio—fit those criteria.
I can’t remember a time when so many stocks in such diverse industries were all trading below their purchase price and had P/Es no greater than 10. The stocks that met the criteria are trading an average of 17% lower than our purchase price, with an average P/E of less than 8.
I don’t know how long it will take for the stock market to turn back up, nor do I know when today’s worries over macro events become tomorrow’s reason for a bull market.
Figuring out what is unknowable is not something I spend my time thinking about. But I do know that buying a portfolio of stocks that have solid balance sheets and are trading at an even steeper discount to our purchase price will, in the long run, make all the sense in the world.
Today I’d like to extend to you a special invitation to join the investors taking advantage of the opportunities available in the Inevitable Wealth Portfolio.
And I’ve made it incredibly easy for you to do so.
Click on the link below to learn how you can claim a FREE 30-day trial subscription to my Inevitable Wealth Portfolio.
This service pounces on undervalued investments…and it does so at a pace unlike any you’ve ever seen before.
We recently posted an unprecedented string of 47 consecutive double-digit winners – with an average return of 49.5% per trade.
That’s right – 47 trades…47 double-digit winners – and an average profit of roughly $5,000 on every $10,000 investment.
Right now, several of my open recommendations are trading at very attractive prices – and now I invite you to take a look at them for yourself without paying a penny for the first 30 days.
Click here to learn how you can claim your FREE 30-day trial membership.
The Inevitable Wealth Portfolio (“IWP”), a general interest newsletter is not liable for the suitability or future investment performance of any securities or strategies discussed. IWP
is published by Eastman Communications, Inc. (“ECI”).Website content is for informational purposes. Communications contained herein shall not constitute offers to solicit, sell, offer or purchase securities, futures, options, currencies (spot or otherwise) or any other instruments of a financial nature. Not suitable for all investors.
Trade involves risk, and may result in financial loss. Under no circumstances does ECI or its affiliates guarantee results of any kind, beneficial, detrimental or otherwise. Recommendations and/or issues are neither endorsed nor guaranteed by ECI.All content displayed is strictly of informational nature, and is not suggested or intended to replace skilled research, advice or guidance from licensed investors or otherwise. Not responsible for broker errors.
This is not investment advice. Content reserved for informative purposes only. This is not an offer to buy or sell stock. Any investment questions should be directed to qualified, licensed, professional financial experts from both private and governmental sources.All performance results, hypothetical and/or otherwise are speculative, limited and unrelated to those from other accounts or individuals. Profits and losses are inherently unique, and should never be expected to meet or match those of any other account. Differences should be expected. Results achieved by other programs and/or accounts are neither implied nor guaranteed. Hypothetical trading does not account for financial risk impact, accountability and penalties.
The testimonials contained herein were provided without compensation. While the experiences described are believed to be true, their claims have not been independently verified, nor has any attempt been made to determine the experience of the individuals after the testimonials were given. Testimonials only provide the perspective of individuals who were successful and satisfied with their experience. The average trader may or may not experience similar results. People can and do lose money trading options. The examples given in testimonials may have limited applicability to what purchasers of the program advertised may generally expect to achieve, and the performance experienced by the persons giving testimonials is not what purchasers should expect. Hypothetical performance results are not implied, and should not be expected to occur. Any and all adverse results and effects should be considered. Success is neither implied nor guaranteed.
ECI is not a registered investment adviser. We do not and will not provide personalized investment advice. We publish opinionated information about companies that we believe our subscribers may be interested in. This site contains “forward looking statements,” inside the definition of Section 27A of the Securities Act of 1933 and Section 21B of the Securities Exchange Act of 1934. Statements that express or involve discussions with respect to predictions, goals, expectations, beliefs, plans, projections, objectives, assumptions or future events or performance are not statements of historical fact, and may be “forward looking statements.” Such statements are based on projections, estimates and expectations at the time the statements are made, and may involve risks which could cause actual results to differ than those anticipated.
ECI and its officers, directors, partners, affiliates, contributors, consultants or employees may hold positions in securities mentioned on the website. We will not initiate a position in any stock recommended for one (1) business day before our original recommendations, and one (1) day following subsequent recommendations. In order to reduce the risk of too many traders possibly influencing the market by attempting identical trades, ECI may limit the number of subscribers in any one service.For access to our full disclaimer and disclosure policy regarding editor securities holdings, go to www.Hiddenvaluesalert.com or call 800-524-4832.
Eastman Communications is the publisher of Inevitable Wealth Portfolio © 2011 by Inevitable Wealth Portfolio, All rights reserved.
