It happens four times a year and it is the most exciting for us normal investors. Investors get to see the performance of the companies they picked and might find some deals after an earnings miss. Hopefully each stock you invest in beat or at least met the guidance and expectations. It solidifies the choices and justifies the risks taken, hopefully with profits in the portfolio.
Sometimes though it can create massive losses as it did this earnings season with those invested in Coke, McDonald's, and IBM. This is why due diligence must be performed for every stock and even then sometimes you can loss big. Warren Buffett is the king of researching a company and normally does not loss money on investments but he lost supposedly at least two billion in a matter of days. Unless he sells though he could recover his losses and even make more money. Still very bad though to have stocks you own go down. It will happen but do not be too hasty and sell from one days down movement. It can always go back up and if the company is strong and solid it might not matter.
Use these few weeks in earnings season to learn about the companies you are invested in and pay close attention. Read the entire report they give to investors. This is the time to make decisions for next year and maybe drop a few underperformers or those that lowered guidance. Enjoy this choppy time in the market and happy investing.
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