current unemployment rates - investing in the stock market even when they are highcurrent unemployment rates and looking at options and riskAs seen through history and right now one thing that hurts the stock market the most is a rising unemployment rate. With unemployment rising it means that there are less people making money and spending the money they have. When there is a rise in unemployment it also means that more people are being let off from businesses failing in endeavors. Many investors simply give up when the market is falling like it has been. That is not how a smart investor handles a situation like this. You should still be thinking about what stocks and companies will be affected the LEAST by a higher unemployment. Companies that seem to do well even in this kind of economy include discount retail, major manufacturing, energy companies, and other companies that are not as reliant on having workers. Make sure that you keep track of unemployment and that when it starts to rise that you invest accordingly. You might also consider buying the typical companies that do the inverse of the market or the ones that have a negative beta.Check If you have made stock investing mistakes Besides just short selling stocks and buying companies that have a negative stock beta-do the inverse of the market, I will list specific examples you might include in your portfolio. XOM Exxon mobile which is a heavy energy company. WMT Wal-Mart of course is of course the largest discount retailer of all time. PG proctor and gamble a major manufacturer. FSLR First solar which is a company that makes solar panels. SKF- Does the opposite of the market if the market is falling. These are just some examples of companies that you could invest in that would be in my current belief resistant to the unemployment crisis. However there is no company or business that cannot be somewhat affected with high current unemployment rates. As investors we must think how we can work around this crisis with high current unemployment rates and adapt as much as possible.make sure you know your companies public publicity what can I start investing in the stock market in examplesHow to properly SHORT SELL STOCKS IN a DOWN market Stocks that are good in this down market are ones that will provide you a barrier of protection. There are other ones that are monopoly companies and companies that have little or no competition which will also succeed. XCL NWE are two good energy companies that essentially have a monopoly. They are also based in the utility market so the odds of anyone taking any great market share from them are close to zero. Other companies that are good to invest in are ones that have an addiction attached to them like alcohol or beer companies BUD or companies that do tobacco products like MO. Companies such as these are less prone to economic and market movement. Also picking stocks with a low beta decreases your risk in a choppy market like the one that we have right now. You do not want to be one of those people who own stock in a company that is going broke like Washington Mutual essentially did. Getting a barrier of protection will help with retiring young and future life plans with safe stocks even if current unemployment rates are high. Are we going into an economic depression, you can still find good stocksThe one thing that you do not want to do is start investing in collective investment schemes like mutual funds right now. You just need to focus on your own businesses and companies which actually stand a chance. When you let other people control your investments you run the risk of them messing something up. Other companies to consider are ones that do the inverse of the market like SKF which is an exchange trade fund, however it is very dangerous and volatile. Howver if you time your bets right you CAN make a lot of money in things like SKF. Also good old fashioned companies like wall-Mart and discount grocer stocks like Safeway SWY will do reasonably well since they are items that people need. Since you invest in companies that sell things that people need you will have a major advantage right now over other investors who are trying to make do with the usual blue chip companies and the high current unemployment rates. Remember current unemployment rates are about 8% so far so people don't have the money they used too.Should you be short selling stocks in the auto industry Many of you here think that you should not be investing at all with this crazy economy that we have been having. However I think there has never been a better time to trade then right now. If you can pull a profit in a falling market by cutting your losses short and investing in index funds, options or any other idea you have to keep your risk low, then you are truly one of the great investors-IT IS STILL POSSIBLE. If you can make money now choosing stocks that do the inverse of the market or you have another plan then you will be able to make a fortune once we are out of this economic crisis. It's of course all about buying reasonable companies at reasonable prices. Buy companies like survival of the fittest think about which ones will have the best chance of surviving. Of course there are a lot of economic problems right now but you do know that this has happened to people before and we have ALWAYS come out of it. The current unemployment rates have been higher in the past and the market has always gone up eventually in the future.WHAT you can do with bank stocks and the financial sector now what other famous investors say we should be doingWhy investing in index funds vs investing in the stock market should be looked at but securities still have the edge.Almost all of them say that you should be buying now and not selling like most people think that you should do. We will discuss ideas for making money investing in stocks and investing trends.Investing in index funds, stocks, or other investments are what you should still be focusing on right now. There are many options that you can use to keep your risk low. One thing that you can do is invest in options which allow you to make a bet on a security for the future. For instance you could start using options to bet on companies going lower in industries that are vulnerable or not doing well. You should not just look at the industry the company is in though rather you need to make sure the people working in the company like the CEO have a bad track record for using options and betting on the company falling. Then you need to select companies that have the good management and of course good products and in the long run if they are managed well and they sell good products they WILL go up if you buy them at a good reasonable value price. You need to think of owning companies like owning businesses 100%. Ask yourself is this a business that I would like to own or buy 10 years from now? If the answer is no then do not buy it for any price especially with high current unemployment rates. Other good stocks to invest in RIGHT NOW Warren Buffet is supposed to be buying - his company is buying five billion into Goldman Sachs despite current unemployment rates. As I have told people who have viewed my site in previous articles, I think that GS is a good value play for the LONG RUN if you buy it now. Warren Buffet uses contrarian investing principles like this for companies that are priced too low-but at the same times are big enough with good management to hold their value in the long run. You can do the same! It's all about knowing that while RIGHT NOW the economy and markets are doing bad, in the long run you can buy companies for much less than they were even with current unemployment rates. for help retiring young We have all heard of Darwinism and his theory about survival of the fittest. That is the way the stock market works, most companies take damage when a crisis hits but the ones that can survive will be cheaper from the damage but they will not die they will only get stronger. Goldman Sachs is a perfect example of that very idea. Right now thanks to the economy it has been hit hard but in the long run 5-10 years it will have a great chance of being a bigger company with a much higher stock price than it has now. These are the stocks people can start retiring young on down the road despite the temporarily high current unemployment rates.NOW is the time to be investing in real estate despite current unemployment rates!!! There are many ways to screen for value stocks like the ones that have been talked about on this site yahoofinance. One way to screen for them are simply to look at the price to cash slow ratio. This is better than the price to sales ratio since much of the companies sales may not turn to net income - EPS. Unfortunately EPS can be a skewed way to look at a company as well since companies fudge on them all the time. What companies cannot fudge on though is the cash per share. So if we look at price to cash ratios we are more likely to find undervalued companies than if we look at other ratios. Price to earnings ratio is only a good ratio if most of it is made up of actual cash that the company will get or cash per share which is the MOST important ratios most companies can have in the short run. BAIL OUT what it means for YOU |