Good time to buy stocks?

Question

My husband is just jumping into his 401k (I believe it's a portfolio of stocks!) and buying stock through his company, which is doing great right now. Is this a good time, as long as we keep our money in during the recession?

Answer 1

He's doing the right thing..you're relatively young. The "red zone" is within 5 years of retirement. At that point you'll want to be more conservative

Answer 2

Lisa, what you say about his company matching 50% is really good. My company matches 33% and will match me for 50% after 10 years employment. I don't know what sector he is in and if its doing great right now, there is a decent chance that in a year or 2 it won't be so hot. However, a 50% match on the dollar is awesome. so, even if the stock stays relatively the same you have that increase which is much higher than the average or even good stocks have been over the course of the last century (typically a 15% annual return is good). So, i'd say if he's just starting up now after he see's his company is doing good it's probabaly a little too late for any decent immediate profit but depending on what company he is in i might go for it. Just no enrons , aol's or bear sterns plz!

Answer 3

anytime can be a good time to buy stocks.  Since you are fairly young you should balance your portfolio with good solid companies that will provide some long term capital.  Use no more than 5% of your portfolio for risky potentially high  return stocks.  Good luck hope you make a mint.

Answer 4

I have been buying tech stocks like crazy because they are cheap as h**l right now. They might go down further, but if you are looking at a long term investment now is a great time to buy a lot of these stocks that have hit rock bottom.

Answer 5

If what you are saying is that his 401K is entirely made up of the Company stock that is risky and not a good deal.  Ask 1000's at Enron who in the blink of an eye lost everything.  What he should find out from the HR Department is what alternatives are available to him.  Sure if you feel the Company is so great keep some of their stock in the account but also get into other areas so if your Company runs into a down turn for awhile you have other stocks that are doing well.  What you're trying to do with that 401K is over his working life amassing a non taxed large sum of money for use after retirement many years in the future.  Yes at the point you start to draw out those funds you will be taxed on them but by than that tax rate will be alot less than he's currently paying.  Another big red flag is wanting to raid that fund for money early.  You will be penalized badly and worse loss the advantage you've build up.  Treat that money as if you never saw it and you'll be fine.

Answer 6

When you're making soup...

Answer 7

I don't know about stocks, but let me tell you this is the time to invest in real state.

Answer 8

Yeah,

Good time to buy Socks.

they must be very comfortable.

Answer 9

Hi Lisa,

In general, I would say that most investors would agree with me that there is likely at least one stock out there worth investing in at any time in the market...so yes, this is a good time to buy stocks from this perspective...but it is a matter of relative value...meaning, it is a matter of figuring out this:  if two companies are exactly the same, wouldn't you buy the one that is cheaper?  That is the premise behind finding which stock to buy.

So if I can give you my two cents on how to find these "good values"...whatever you do, invest cautiously.  I know this sounds obvious, but, you should only invest the amount that you can lose.  Believe me, I have been through the whole cycle (lost a bunch but I doubled my money too recently on a stock, Tengasco (ticker: TGC).  One important but not the only metric is the projected price to earnings ratio (PE) or PE to Growth (PEG).  You want to buy companies that are priced less than the industry average PE or PEG.  Please do some research and read up on this philosophy.  Of course sometimes a company trades with a PE or PEG that is lower because it has problems (such as management issues, missed earnings, huge debt, etc.)...but if it is a quality company, and if the company is undervalued (that is, if the PE and PEG is low relative to the average PE or PEG of its industry)...its probably a good stock to buy...here is the link to a website I have found that ranks stocks to help you pick stocks (it also has an article in the link at the bottom that starts "Guidance..." that can explain the PE and PEG thing more):

http://www.freestockvalueranker.com/

Hope this helps!

Jack

Answer 10

Yes, I have been buying also.  Buy low, sell high!  Got C at 15 the other day, now its at 20.

Answer 11

anything involving senors

baby boomers are turning 60 every 6 seconds

other then that, i would only invest in banking corporations

EDIT - as long as you know the company will not be affected by the upcoming depression to the point of bankrupcy.

Answer 12

I think it is a great time to invest, especially long-term, plus 401ks offer great tax advantages.  To learn more about the market, you might want to create a practice portfolio at http://www.top10traders.com - it's free.