This Day On The Street
Continue to site right-arrow
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Stocks Under $10 with 50-100% upside potential - 14 days FREE!

5 Money-Making Tips for the Panicky Investor

BOSTON ( TheStreet Ratings) -- With the stock market seesawing and investors pulling tens of billions of dollars from mutual funds in the past few months, now's the time to get back to basics.

As equities are down by about 15% in the past two months, as measured by the benchmark S&P 500 Index, individual investors have the chance to buy some of the greatest U.S. companies at a discount. That is, if they think the stock market will recover. Professional investors including hedge fund managers and mutual fund managers are worried about slowing U.S. economic growth, Europe's massive debt woes and the dysfunction in American politics.

So what's an investor to do? Here's how you can become a better investor:

1. Have a Strategy: This might seem obvious, but too many investors select stocks haphazardly. Whether you're a short-term trader or a five-year investor, set a plan and stick to it. Some of my biggest investing mistakes came from selling a stock prematurely because I heard a rumor that was ultimately unfounded.

Consider an investment in a stock for what it really is: a stake in a business. Given that, what's the basis for investing in this company? What are the catalysts that may propel the share price higher? What could go wrong? And will I sell if these things happen? Some other questions are: What's my timeframe for holding the stock? How much money do I want to make on this investment?

2. Don't Ignore Economic Events: You might think you're holding the next Apple in your portfolio, but if Greece or another country in Europe defaults, your stock is likely to fall regardless of its prospects. For many, this might be challenging to understand, but with investing comes the threat of financial contagion.

Contagion is typically caused by the default of a large bank and. When it happens, diversification is less effective. Contagion (you can think of it like catching a cold) is a concern now in that problems in Greece are likely to spread and hurt other European companies. The worry is that the U.S. gets sick and puts the final nail in the coffin for an already struggling economy.

1 of 4

Select the service that is right for you!

Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!


DOW 17,356.87 +288.00 1.69%
S&P 500 2,012.89 +40.15 2.04%
NASDAQ 4,644.3120 +96.4780 2.12%

Brokerage Partners

Rates from

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs