Current Market Condition

It's hard for individual investors to get a grasp on what is going on right now with the markets because there is no defined direction. Sideways markets are tough for traditional investors because they don't know how to deal with the daily fluctuations. All of your gains on one day can be wiped out the next day, so you lose confidence.

One noticeable thing with these markets lately is the volume. There is very little! Prices fluctuate tremendously during low volume times. The key to dealing with this is to know why things are moving. If a company declares bankruptcy, that's a big deal and you expect the volume to pick up greatly as people get out of it. But if good companies are stable and nothing changes, the price could move on low volume and this is most likely people repositioning their portfolios. Look at these times to gain more shares at a cheaper price.

There are tons of opportunities out there with good solid investments. Knowing what type of individual investor you are is the first part of determining what to invest in. Are you a trader, short-term or long-term, are you a buy and hold investor, do you like income and dividends or growth, or a combination of the above.

Personally, I'm all of the above. I've spent years learning how to do this, and constantly learn more along the way. I think that it's important for individuals who want to manage all or some of their money to know all different approaches so that you can take advantage of the market when opportunities present themselves.

Many people try to predict the market, but you really can't. You can only react to what it offers you. Take advantage of it when you are given the situation. Be smart with your money because it's hard to get it back. Even if you have someone else watching your money, you have to know as much as they do to be able to ask the right questions to safeguard it.