Don't Look Back, Plan Forward for Your Business |
I don't know if you looked at the ticker on MSNBC, but the DOW slipped back in to the 11,000's for the first time since early 2006. In times like these, it is important to have a game plan. I've explained earlier that this is a time to rejoice rather than panic. Think of the situation as a blowout sale- all the stocks you've ever wanted are available at closeout prices! In order to take advantage of recessionary times such as these, it is important to maintain a cash reserve in your portfolio. A conservative portfolio typically consists of 60% stocks, 30%, and 10% cash holding (I prefer a more risky approach with 85% stock because all research provides that stocks have a much higher average return and provide dividends). The 10% cash holding will allow an individual to take advantage of great prices. And right now, it's like a firework stand on the 5th of July.
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