Stock Market Tips – The Two Different Methods Used to Amass Great Fortune in Stocks

When you invest in the stock market of any country you want to grow with the economy – the economy of America, China, Europe or any emerging market. When you invest in the stock of a particular company You wish you could grow with the company – you wish you were with Microsoft in late 1980s when it started to grow you wish you were with Internet companies in 1995 when they started to grow (you also wished you could have gotten out of them by 2000).

You make the maximum fortune in a stock by discovering and investing in some young enterprise which might later grow into a behemoth. A basic study of the stock market of any country will show that two very different methods have been used to amass great fortunes. Most of the big fortunes and many small ones were made largely by betting on the business cycle. Buying stocks in bad times and selling them in good created huge wealth. This is particularly true for those with good financial connections and advance information. For example take the commodity stocks – Iron and Steel. After decades of bust cycle they started their boom phase in 2002. Anyone who has invested in steel stocks in 2002 would be sitting on huge fortune today. The same steel stocks which were considered stagnant by 1960 is one the vibrant stocks today.

Another way to amass great fortune in Stocks is to find the really outstanding companies and staying with them through all the fluctuations of a gyrating market. This you need not even worry about buying the stock cheap at the lower end of business cycle and sell it high at the times of boom. I would give an example of APPLE Inc. Those who have studied the growth of Apple from McIntosh era of 1980′s to the bust cycle of 1990′s and the great revival during current period will observe this point. You would be today making enormous profits on APPLE Inc. Stock if you had stayed with it even during the troubled times of 1990s.