Understanding Historical Stock Market Data

To begin with, strategies in investment in the stock market compare to opinions. However not everybody has one. The easiest way to get frustrated in investments is by investing in the stock market without a clear strategy. To make money in the stock markets, one has to have a defined strategy of how to play in the stocks investment game.


It is advisable to consider the approach that most popular stock performance indicator like the Dow Jones use. The Dow Jones has hit 10000 twice; in the year 1999 and 2009. In both periods, the stocks were frustrating for most investors.

To make valid investments, an investor is supposed to make fundamental decisions regarding the investment strategies. The investor should decide whether they want to invest in the short term as traders or speculators. On the other hand, they should decide whether just to buy and hold stocks.


However, not many people make money from investing in the short term. Of course, there are days they will all be smiling, but market swings are not always reliable. Moreover, short-term speculations are usually a part-time job that demands one’s experience, time, and effort.


When an investor chooses the buy and holds approach to the stock markets, it is a strategy that does not require a lot of effort. The approach has in the past produced long-term returns of averagely 10% in a year and over the long term, for the last fifty plus years. However, this was not the case in 1999 and 2009. The historical stock market data indicates that for ten years, the easy approach to investing in the stock market had little gains for investors.


Investors should have a defined objective and the right perspective of the stock markets. Trying to make money in the stocks from short term speculation or simply by buying may turn out to be detrimental. Crossing the fingers after a bad move cannot help.


The stock market has recurring bears and bulls market that from time to time hit both extremes. Investors should take note of these patterns while paying attention to the stock prices. By looking at what is happening with the popular stock market indexes from time to time will give the investor an idea what’s going on in the realm of stock investments.


Investors should be aware of the concept of historical stocks market volatility. The idea of stock market volatility is that stock market will fluctuate in the short term; on a daily basis. It also teaches that investors should look at what is constant and reliable rather than what is always vacillating. Though volatility is the norm in the stock market, investors should look for what is relatively stable.


As it were, the investor’s’ wealth is got from historic market volatility. Those who understand the stock markets are the ones who make clever moves.


Extreme price movements mean that it’s time to act. The best way to recognize these movements is familiarizing with historical stock market facts. A long term chart of famous market performers could be a good place to begin.

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