Wealthion: The Most Successful Investors Do These 2 Things Very Well

Investing can mean different things to different people. The general view is that investing is using wealth to create more wealth. That can mean anything from buying and holding great stocks, to trading in and out of rising stocks. It can mean anything in between, or, most likely, a combination of various strategies across a portfolio.

Once market cycles enter the picture, two factors come into play that are crucial for investment success.

The most successful investors look to avoid losing too much money during a market selloff. This can be achieved in several ways. The first is to take profits and raise cash when stocks are rising.

Cash may not have a positive return after inflation, but cash earning zero percent is better than sitting in a stock that gets knocked down 20 percent or more in a bear market.

The second is to have the courage to buy near the market lows. When investors follow the old adage to “buy when there’s blood in the streets,” they get the best bargains. Those who wait for the markets to definitively move higher lose out.

They may miss out on the first 10-20 percent of an overall market rally, but even higher returns on growth stocks.

Investors who can learn how to do these two things even fairly well can substantially beat the market averages over time.

To watch the full interview, click here.