As my friends and I usually say when we trade stocks especially when buying, we say 'It's shopping time!' Now, is it 'shopping time?'
A resounding YES! Let me explain why it is time to buy stocks NOW. I will show you WHY by using illustrations from the Philippine Stock Exchange.
Miko Sayo said, when he talked about stocks in one of my MBA classes, that generally The Philippine stock market shows a cycle of boom-bust in 10 years. He said this in the early 2006 AND he said that time that 2007 will be a bull market in the Philippine stock market - looking back, he was right.
Shown below is the Philippine Stock Exchange's index (PSEi) from 1996 - 2008. It is an interesting study of a typical stock market volatility.
The above graph shows that stock investments are best be done with long term in mind. If an investors want to trade through the stock securities volatilities, then an active portfolio management and perhaps, complicated trading processes, are NECESSARY. But for average investors like me, long term is the way to go.
Now, let's take for example the stocks of Philippine Long Distance Company (PSE: TEL). A year ago, it traded at P3,000, now it is trading at P2,200 AND four months ago, it even traded as low as P1,850! A decline of almost P1,200 in the stock's value!
Once my BPI Trade account is activated, I am buying TEL and so much more.
Folks, it is shopping time!
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