Stock Market Tips: Why You Need to be Invested in Stocks NOW! (and when to get out)

On the surface it would appear to be an extremely volatile and risky time for the stock market! In fact, many investment advisers are recommending that their clients not take large stock positions. This is a huge mistake.

I believe that the stock market is poised to make some of the biggest gains ever made.

While it is true that we are facing international war, terrorism risk, high fuel prices and many other troubles, the stock market (in the big picture) is hardly affected by these things at all right now.

This may sound like a completely counterintuitive and even bizarre statement to make. However, stocks (just like seasons) are affected by large cycles, small cycles, and demographic spending patterns.

For example, for a very long time the stock market has been following a highly stable 10-year pattern. During each new decade years that end with 1 through 4 are typically down to flat years. Virtually all of the gains in the stock market occur in years ending in 5 through 9, and years ending in 0 are typically strong down years. Quite often there is a mid correction late in the year 7. The strongest gains often occur from late in year 7 to mid to late year 9.

Also, it is fairly well known that most of the stock market gains for the entire year will occur between October and April.

There is, of course, another major factor that will influence the stock markets over the next two years: Namely, the baby boom generation. Stock markets in general follow a very close correlation to the peak spending years of the baby boom generation. The largest spending boom (and subsequent drop off) will be occurring through 2009.

This will correspond perfectly to the typical 10-year seasonal pattern of the stock markets.

In my opinion, someone entering the stock market in the fall of 2007 should do extremely well over the next two years.

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