written by reader Complete newbie!

By zaeraiphel78, August 5, 2014

I am completely new to the market. For the past few months I have been reading as much as I can about how, when, and why to buy/sell a stock. That being said (disclaimer) if I say something idiotic please laugh at me then help educate me. My question is about what I am reading about the market possibly being severely affected by the fed raising interest rates. Is now a good time to start investing?

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Travis Johnson, Stock Gumshoe
August 5, 2014 1:30 pm

I think the best time to start investing is when you have the money, but that doesn’t mean you have to pour all your money into the market at once — after a long bull market like we’ve had the nerves of investors are jittery and the fear of a market decline is everywhere, but that doesn’t mean the market will fall within the next year. It might, of course. Generally, rising rates are tough on some companies and sectors but my personal opinion is that we’re likely to see rates rise so slowly, and so steadily, and the rate hikes are so widely expected, that it’s not likely to have a huge impact for those who can ride through the ups and downs without panicking, but if something really unexpected happens — another recession, a sharp return of inflation that causes rates to go up more quickly — then there could be wild days. The market is easily panicked, and stocks are fairly expensive compared to the last several years — but to my reading they’re not wildly expensive like they were before the dot com crash, or like real estate was in 2007 before it precipitated the 2008 crash.

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