by nissa_amas_katoj

Created on: October 23, 2008

The stock market is falling. Yippee! It's time to go shopping for stocks. Stocks are in the long term the best investment, in spite of short-term market corrections and bear markets. It's the best way to save for your future.

But it's important to be a smart shopper, whether you are shopping for stocks or canned peas. You don't buy rotten food at the supermarket just because it's on sale, you don't buy stocks from a crappy company just because they are cheap. Learn to tell the difference between a good stock and one that has no future.

One good book to read about stocks is 'The Dividend Growth Investment Strategy' by RoxAnn Klugman. The author gives the names of many stocks which have a long history of growth in both the stock price and the dividend. These stocks are good ones to start with.

You will need to research your stocks to find out what they are doing now. You might try looking them up at www.dividend.com or at one of the many other web sites that will help you research stocks. You might also look up the company's web site and look for news articles mentioning the company.

Next, look at what the stock price for each stock on the list is currently, and what it has been in the recent past. Some of your stock choices will be down considerably from their most recent high. Others will have lost very little on the price, but these stocks may well be a better choice because they are holding their value well even when other stocks are losing money.

Don't be sucked in by a stock with a very low price. Most times when a stock is very cheap, there is a reason for it- the company may have bad management, or be losing money. Be prepared to pay a little more for stock from a good solid company, even during a market correction. Cheap, second-rate stocks will cost you more in the long run.

Don't let the market correction scare you into selling good stocks at a low price. If your stock is down 10% and you sell, you have made the loss permanent. Too many people are frightened by market fluctuations into selling when the price is at rock-bottom, and buying when the price is sky-high. That's not the way to manage your money. You should buy when the prices are low and sell, if you must, when prices are high.

The stock market is full of opportunities for the person who will take the time to do a little research, and who refuses to be scared by the market's ups and downs. When the market is up, you profit. When the market is down, you can make good buys on stocks that will bring you future profit. What's not to love?

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