These are not normal times.
I’m not talking about how our lives have been turned upside down by the pandemic. I’m talking about this stock market rally.
Prices have been driven up by small investors, many who just jumped into the market since this crisis began. Meanwhile, institutions and professional investors that typically move markets are waiting to see the full economic impact of the pandemic.
In today’s video, I show you the shocking charts that prove individual investors are at risk of having the rug pulled out from under them. But there are great opportunities to buy undervalued companies … if you know where to look.
Don’t Drink the Kool-Aid
There’s nothing inherently wrong with more Americans participating in the stock market. But if they’re basing their investment decisions on the latest headlines, then they’re setting themselves up for big losses. And that’s exactly what’s happening right now.
The idea that the stock market as a whole will go up forever, untethered from economic reality, is a fantasy. As I explain today, you need to understand what’s driving market moves and where to look for long-term value.
In today’s video, you’ll find out:
- Stocks are trading at low volumes, even amid a big boost in new small-investor activity … and here’s why that should worry you. (3:15-12:07)
- What history tells us about how the wealthiest Americans protect their money in bear markets … by selling stocks to the rest of us. (12:51-15:04)
- Which types of investments still offer good opportunities. (15:04-16:32)
- And much more.
Editor, The Bauman Letter