Stock market volatility fluctuates all the time, some days more than others. Volatility in the markets grow as the gains increase along with those times when uncertainty rises.
Since the markets have risen as high as they did and the condition of the economy is still on shaky ground, I’m not surprised to see that the VIX (volatility index) jumped 20% in just one day. What does surprise me is the fact that it took so long for it to happen.
In the last fourteen months, the Dow Industrial Average (DJIA) has increased by nearly 80% and over 10% in the last three months. I’ve been saying for quite some time now about the fact that the DOW sitting at over 10,000 points has no real reason to be there. Of course many investors are still riding the wave as long as they can. Unfortunately many of them won’t see it coming when the markets take the next plunge.
Unemployment is at 12% (officially), but it is estimated to be at 17% since most people who were receiving unemployment benefits last year are no longer eligible. Many companies are holding off on hiring until they get a good look at the new tax laws that the present Administration has passed. Add on the fact that the foreclosures in the United States are not shrinking, instead they are holding steady in most areas.
The VIX is one of the indicators that should be watched on a regular basis as part of your stock market strategies. As the uncertainty in the markets rises, the VIX will climb. Many average investors lose money in the stock market as this happens because the price per share of most companies will rise and fall with large swings. If you are a veteran in trading stocks, most likely you’ve learned to read the VIX and play it accordingly.
For those who are not familiar with VIX, there are a few stock market books that will help you understand much better. In many of Jim Cramer books, you will find information about the volatility in the stock market and how to play it.
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For those of you considering investing in gold as a preventative measure against paper currencies and the mismanagement of governments, the best loved and unarguable top gold ETF to buy is GLD – also called SPDR Gold Shares. The unique feature of this Gold ETF centers on its relationship literally matching the valuation of gold. Although one could reasonably assume this to be standard, where ETF’s, or Exchange Traded Funds are concerned, it is certainly not. Numerous ETF’s operate with futures contracts that are generally less predictable and so riskier investments. Although past performance is no guarantee of future results, gold ETF funds like GLD, prove to be a less risky option than alternative commodity investments, particularly for those that understand well what is happening with the economic picture.
There are those investors who feel confidant that deflation has already begun, and that would prove to be gold bearish. A few of them will indicate television advertising, claiming that after the public catches on to an investment, it is time to sell. Yet different investors believe that because of the government running the printing presses overtime to create more money, the value of gold will keep going up. Gold more or less proves to be protection against a declining dollar, and its performance is based on other country’s currencies and economies as much as it is on those of ours. Could our economy perform sufficiently for us to build up our currency’s value, or might we have to maintain a weaker dollar to be able to compete internationally? Perhaps more involved than before in history, this involves a complex series of actions and reactions.
Despite all of the background noise going on, a constant concept emerges. The majority of both gold bears and bulls concur with gold maintaining the upward trend over both the medium time frame, as well as internationally. A number of investors today feel certain that one day the specter of hyperinflation will rear its ugly head, causing GLD, and also UGL (ProShares Ultra Gold), to both be solid investment ideas for all long term minded investors.
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I’ve said it many times, and I stand by it; Stock Trading Is Not A Game. It doesn’t matter if you’re a trader or an investor, you must do your homework by researching every stock you plan to invest in or trade But what if you could play a game and practice investing without risk? You could have fun “playing”, while learning and understanding the stock market even more.
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I stumbled upon a free website where you can trade stocks on a virtual Wall Street. UpDown.com is a free fantasy investing site. People join UpDown to practice investing and can earn money for winning contests. Start with a $1,000,000 cash reserve and start trading stocks immediately after registering and creating a profile. With up-to-date news information along with an active forum for members to share ideas and investment strategies.
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The UpDown is a community for people interested in investing in the stock market. If you’re new to the stock market or have a few year under your belt, this site will give you the chance to try different strategies without any actual loss of money.
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UpDown.com provides a platform where investors can view, share, and rate high-quality stock analysis and investment ideas. They then filter, aggregate, rank, and present the community’s investment recommendations for the benefit of all UpDown members looking for valuable investment advice.
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Click the banner below, or the one in our sidebar to join. I just joined myself and it looks like a good place for me to test out new strategies that I normally wouldn’t, with my own money.

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