Dow Jones Rises 4 percent in May – Should You be Invested?

Filed in Uncategorized by on April 29, 2011 0 Comments

The Dow Jones is on the rise, but how long will it continue. Private investors see big ups and downs in a short period.

If you are not interested in taking risk, you will find limitations in your investment choices. The key to investing is diversification, and making good investment choices. Individual investors are not convinced that the stock market is a good way to invest hard-earned savings. History has proven that the stock market is a good investment.

With gasoline and the prices of goods on the rise, consumers are uneasy. This is bad news for companies that are manufacturers, and those that sell those goods. The Fed keeps a tight rein on the economy by keeping interest rates low. So one of the few places you can make a good return on your money is the stock market.

With a presidential campaign on the horizon Americans are inundated with what is wrong with our economy. When you continually hear bad news about the economy, you wonder where are we headed?

According to a Fox Business News article, “The markets performed solidly this month. The Dow was up 4% and the NASDAQ jumped 3.3% — the best monthly performance this year. Indeed, the NASDAQ is now at its highest level in nearly a decade.” The Dow has come a long way from the major down turn of 2008.

Remember the stock market is a risk. If you cannot afford to lose any money, you will be better off choosing a safer investment. Many feel that investing in stocks is a form of legal gambling. The gamble is worth the risk if you know what you are getting into.

You can and should invest a part of your savings in stocks. Investing is confusing when you are a new investor. If you aren’t interested in choosing individuals stocks, then there are many other choices like mutual funds. Many of us heard Grandma say don’t put all of your eggs in one basket. This is as true today as it was then. Individual investors need to do their homework. Choosing solid companies to invest will cut the risk.

Photo credit: cohdra from morguefile.com

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