While you are sitting right there in the comfort of your own home, sipping your favorite coffee and trying to wake up, the outside world is in chaos! Okay, that might be an exaggeration, since it’s not like we are on the brink of a revolution or anything like that. Yet, stock market traders are definitely experiencing an increase in the levels of their anxiety and stress.
What’s that? You are a trader yourself? Well, what on Earth are you waiting for? Put that coffee down and jump on board, because we are all about to go crazy with worry here, so it’s not exactly fair of you to just sit in the dark without knowing anything about what’s happening on the market. The only reason why you might be calm is because you are a beginner and you haven’t yet picked up on how this whole world works and if that’s the case, then I suggest you visit https://tradingreview.net/ or a similar place that can give you some tips and put you in the loop.
I bet that you are rather curious right now and eager to find out what on Earth I am talking about. Well, I won’t keep you in suspense any longer, so here it is. While nobody can tell that for sure just yet, there’s evidence that the market is actually in a bubble. Enthusiastic market behavior led by nothing but emotions and a huge surge in prices of certain assets has led to this kind of a situation and traders are now stuck in a situation that they don’t know how to get out of successfully. What’s more, they can’t even tell how things will play out in the end and that’s what’s driving their anxiety through the roof.
Beware Of The Results
Do you know what happens to bubbles eventually? They burst, and that’s certainly not a pretty sight for anyone. So, if you are joining the army of those traders that suspect the market is in a bubble and that don’t want to suffer the consequences of it bursting, what is it that you should do? Should you just wait and see what happens, or should you rush off to employing some exit strategies right away? The answer is perhaps.
Yes, you have heard that right. The answer is just as unclear as the whole future of the market and that’s not because I don’t want to give you a straightforward and direct reply to the above question. It’s simply because you can hardly ever know what the right moves should be in these kinds of situations, meaning that you are basically left to your own devices and have nothing but your actual knowledge to rely on. And hope. And lots and lots of anxiety.
Although that might sound a bit harsh, I suspect that you actually needed to hear it. This page might have some further explanations for you on what can happen if the market does end up to be in a bubble. I, however, have some good news. Even though I have mentioned above that you are basically left to your own devices, the truth is that you actually aren’t alone here. So sorry if I’ve made your anxiety worse than it way.
Now you are probably wondering how on Earth you aren’t alone, so let me elaborate. I’m not talking about the fact that far too many traders are in the same pickle as you. Instead, I’m talking about the fact that you might actually learn what to do, or rather what not to do in these situations, meaning that your own instincts are not the only thing you can rely on. So, let me share a few tips on what you should and shouldn’t do when the market is in a bubble.
What You Shouldn’t Do
We are starting with the things you shouldn’t do, because addressing those seems a bit more pressing. People are bound to make impulsive decisions when they find themselves backed into a corner and, usually, they regret those decisions afterwards. So, that’s the very first thing you shouldn’t do when you find yourself a part of this bubble. Don’t act impulsively.
Do you know, however, why people act impulsively in the first place? The answer should be quite obvious. It’s because they get overwhelmed by emotions and they are unable to take control of them. While emotions are nothing to be ashamed of, the truth is that there should be no place for them in the stock exchange market. So, make sure not to let your emotions take over, because they will only lead you to some bad decisions and, if we are being perfectly honest, emotions are actually what led to the market bubble in the first place.
What You Should Do
This is going to sound super weird right now, but sometimes all you have to do is nothing. You’ve probably never seen a sentence contradicting itself that much and perhaps this should have been told in a different way, but I believe that the very contradiction is what will etch this piece of advice into your mind and make you remember it. And, you should definitely remember it. In the words of a successful investor, John Bogle about how to invest in a market bubble: “Don’t do something, just stand there”. Sometimes, all you have to do is stand there and wait to see how things will play out.
Of course, I am pretty sure that just standing there without doing anything at all will be difficult for most traders, so let me make things a bit clearer. You should definitely continue doing your research and keeping track of the trends. In addition to that, you should learn exactly what the wisest moves would be for the particular types of trades you are dealing in, because that will help you come out as the winner even if the mentioned bubble bursts.
