Tip #12 - How NOT to handle a share market downturn

Every week we post a tip that we hope will help you become a successful share market investor.

Tip #12 — How NOT to handle a share market downturn

First, dither around for some considerable time trying to decide if the price falls are short-term and will quickly bounce back or the start of a serious price slide. Second, once it is clear that this is serious, sell up after most of the damage has been done and take a bath. Third, watch the market recover while you try to decide if this is a minor price spike or an ongoing recovery. Finally, once it is clear it is a sustained recovery and you have missed most of the gains, reinvest your remaining funds and wait for the next price fall.

This information is not a recommendation nor a statement of opinion. You should consult an independent financial adviser before making any decisions with respect to your shares in relation to the information that is presented in this article.