New year, same stories.
Just as we were settling in yesterday evening for a recap on the day’s market action, the following headline flashed up on our screen:
‘Stocks dip after hitting fresh peak: Chinese markets hit by disappointing manufacturing data‘
European stocks were down over 1%.
Sheesh!
Can’t we have just one day of normal trading where the market doesn’t fret and fluster about China or central bankers? We guess that’s too much to ask.
But it shouldn’t be. It really is a crying shame that governments and central banks have manipulated the market so much. Their actions have driven away investors.
And if investors can’t or won’t invest in stocks it means they’re missing out on what we believe is the greatest wealth-building mechanism on the planet…
We’ll ask you a question: How many successful business men or women (and we mean billionaire-sized successful) have you come across over the past five years who have said they’ve given up on business because things are too hard?
Not many, we’d wager. That’s because for the most part they see running a business as a challenge. If an obstacle gets in their way they instantly look for a way to get around it.
Yet that’s not always true of the average investor. For some of them, when an obstacle appears they use it as an excuse to give up. So as the various investing obstacles have appeared over the past five years, many investors have thrown in the towel, claiming it’s all too hard.
In doing so they’ve missed out on a spectacular chance to grow their wealth. But while the average investor may have sat on the sidelines, the world’s richest business people have faced the challenges head on, and for the most part come out well ahead.
Be in the Investing Business
If you’re a regular Money Morning reader you’ll know we keep a close eye on the Bloomberg Billionaires index. The name is self-descriptive. It tracks the changing fortunes of the world’s richest people.
According to the report from Bloomberg News:
‘The richest people on the planet got even richer in 2013, adding $524 billion to their collective net worth, according to the Bloomberg Billionaires Index, a daily ranking of the world’s 300 wealthiest individuals.
‘The aggregate net worth of the world’s top billionaires stood at $3.7 trillion at the market close on Dec. 31, according to the ranking. The biggest gains came in the technology industry, which soared 28 percent during the year. Of the 300 people who appeared on the final ranking of 2013, only 70 registered a net loss for the 12-month period.‘
We’re almost prepared to bet our bottom dollar that even the 70 billionaires who lost money in 2013 won’t give up on trying to make money in 2014. That’s the nature of truly successful people. They don’t let a setback or adverse circumstances get the better of them. Instead, they fight and seek new strategies to win.
They understand that taking risks is all part of the game.
So the key to being a successful investor isn’t to think of yourself as an investor at all. Rather, you should think of yourself as a businessperson running a business.
If you think about investing like a businessperson you’ll start to think like a businessperson. That will help you adapt to the changing market, just like a businessperson.
Did You Beat the Billionaires in 2013?
Note the quote from the Bloomberg News article again. It says ‘The biggest gains came in the technology industry…‘
We figured 2013 would be a great year for technology stocks. That’s why in late 2012 we decided to found and launch a technology focused investment service. We called it Revolutionary Tech Investor.
Like any business venture it didn’t happen overnight. By the time we hired the staff and got it up and running it was May. That means we missed the first five months of the year. Even so that didn’t stop our stable of tech and biotech stocks achieving an average return of 22.7% over the past seven months.
That beats the S&P/ASX 200 and on an annualised basis (38.9%) it beats the average wealth gain of some of the world’s richest people.
As you can probably imagine, our only regret is that we didn’t launch Revolutionary Tech Investor sooner. But we’ll continue to back tech stocks this year in what could be an even bigger year for returns.
The point is we spotted an opportunity in the market and acted as quickly as possible to help investors profit from it.
But that’s just one example of adapting to get the most out of the market. In 2012 we also recognised that low interest rates were coming to Australia, so we told Australian Small-Cap Investigator subscribers to make the most of it. We showed them how to buy into high yielding small-cap dividend paying stocks.
It was good advice as interest rates fell. We maintain the same advice today.
In fairness, it was the extension of a theme we had banged on about since 2011 right here in Money Morning. We’ve insisted that investors have at least 20% of their wealth in dividend stocks.
That may sound like obvious and uninspiring advice today. But if you think back to that time, most folks were running scared from the market, selling everything they could, as they feared an economic collapse in Europe and the US.
What Would a Successful Businessperson Do in This Market?
The point is, we’ve learned to adapt our investing style over the past five years, just as a successful businessman or woman learns to adapt their business to a changing market.
Some of our critics have accused us of being a flip-flop and lacking principles as we adapt our strategy. They can think that if they want to, it doesn’t worry us. Those are the people who are probably still 100% in cash or 100% in gold, who failed to grasp the importance of the changing market.
Meanwhile the investors who embraced change and bought into tech and biotech stocks last year should now be sitting on a 104.9% gain on our 3D printing stock tip and a 61.4% gain in just two months on our stem cell stock tip.
Our advice to you is simple. Don’t think of yourself as someone who buys and sells shares, a buyer or seller of gold, or even a buyer or seller of property. Think of yourself as a successful businessman or woman. Then think about what other successful businessmen or women would do in this crazy market.
We know one thing for sure: they wouldn’t throw in the towel and sulk on the sidelines waiting for things to improve. They would take the proverbial bull by the horns and make the best deal they could in the circumstances.
If you want any chance of building your wealth today, that’s the attitude you need to adopt. Do it now and we’re certain you’ll have a successful year in 2014 – you may even outperform the billionaires in the Billionaires Index!
Cheers,
Kris+
Special Report: 574 Years in the Making
