S&P Downgrade- What it means for Investors?
Today's Yahoo Finance talks about the 7 Common Mistakes that Investors Make.
The last week has been very turbulent, with markets going down after the debt troubles in USA and Europe. Then at the end of the week, S&P downgraded the US government securities from triple A to AA+.
This basically makes US government securities, one of the safest in the world, more risky. It also makes it more expensive as investor will demand higher interest with higher risk.
In the short term, it could force the US treasury to increase interest rates while the US markets and unemployment are still mired in all sorts of trouble.
While the 7 mistakes that the Yahoo Finance article points out that we shouldn't pay too much attention to financial news, it doesn't mean that you should know it at all. Being able to filter out what is crux of the issue and what you should do as an investor is more important.
The last few days and most of the past few weeks, markets have been tumbling down. It's fascinating and scary at the same time. Start of a new government related debt crisis?
For this period, I would sit tight and wait for buying opportunity to go into the stock market for companies whose stock prices have fallen below their fair values. What are you looking to buy?
Source:
1. The US Credit downgrade
Post a Comment