Investors who made purchases at the peak of the euphoric commodities run are either worrying or cursing their actions. Neither trading nor investing promotes clear thinking. Here are some suggestions for navigating the present market shakeout.
1. If you think you picked the proper stock or stocks to invest in, turn off your computer and go do something fun. A fantastic way to reduce stress is to exercise. The market’s restructuring has already started. Your best chance is still ahead if you didn’t get stopped out or didn’t set earlier stops: you can buy more shares at a considerably cheaper price. The majority of the experts we spoke with agree that the next rally should begin between late July and Labor Day. When we attempted to interview James Dines, the expert on uranium, in late May, we were given the response, “Call back in a couple of months.” That served as a useful indicator that the markets weren’t really interesting. Mr. Dines frequently looks forward to interviews, but not recently.
2. Do you think the underlying factors that led to the commodities boom have changed? If not, the bullishness is only pausing for a moment. The markets don’t appear to be fundamentally changing. Despite its oil output possibly reaching a peak, Russia still desires nuclear energy. China hasn’t declared that its nuclear development program is coming to an end. For new nuclear reactors, India wants to spend $40 billion. If you own uranium equities, spot uranium recently increased by another $1 to reach $45 a pound. The bull market is very far from over.
3. Stop following the ticker and concentrate on the company’s fundamentals if you are concerned about your investment in one stock or another. Has the tale altered or is it still accurate? Look below at #7, A, B, and C.
4. There’s an ancient adage that says you should buy something when you want to get rid of everything you already have in the category. It can be smarter to increase your holdings at the same moment you wish to sell your complete portfolio of uranium equities. This mostly relates to retail investors. The majority of experts did sold out at the high and are now gradually acquiring the shares that the ignorant held onto until the washout before beginning to unload them.
5. Has a significant, earth-shattering event taken place? After Three Mile Island, the last uranium bull cycle came to an end (TMI). Following the revelation that Bre-X Minerals had defrauded investors about its purported gold “find” in Indonesia, the last respectable rally in the precious metals markets collapsed. There is always something important, newsworthy, and far-reaching happening. The cause of it is that. Similar to TMI and Bre-X, those were the opening salvos that set off a later chain of events that ended both bull markets.
6. Consider if you truly want to sell these shares to a bargain hunter who will profit from your losses before you pull the trigger.
7. Please check the following fundamentals for any of the uranium firms you have read about because the majority of you will still be in a panic:
A) How much money does the business have on hand in the bank? The king of shakeouts is money. Prescient businesses are doing well after finishing their financings during the recent and strong upswing. They can withstand the immediate storm and are prepared to advance when this correction reaches its low point and turns around. When this correction appears to be the most doomsday, those companies are the ones to look at.
B) Is the management still in place? The story likely hasn’t altered much in recent weeks, unless the top financial and/or technical personnel abruptly left. Businesses with a strong technical team are tough and effective. They will continue on.
C) Were the properties inconclusive? You purchased stock in a uranium firm, among other things, because it claimed to have “pounds in the earth.” More than others, some businesses have more. A National Instrument 43-101 was completed by some at much expense and difficulty, and it served as an independent confirmation of the quantity and quality of the uranium reserve. That would be one thing if it changed and the corporation said, “Sorry, nothing there after all,” or, “Hey, we were kidding.” The uranium didn’t leave or shift to a rival’s property, if you haven’t heard it or seen a news release proclaiming that. It remains in place.
Consider this biblical counsel the next time the markets are surging upward and you feel like you just hit the jackpot. When did Noah build his ark, goes the old joke. Naturally, the response is: Just before it started raining.
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