Can You Make Easy Money In The Stock Market?

A question that is asked often - in life as well as - in the stock market, is whether it is possible to make 'easy money'.

Your author's opinion is that there seems to be very little easy money to be made anywhere, and the stock market is no exception. As such, this is a question usually asked by beginners to stock market investment rather than those with more experience.

However, on very rare occassions, it does happen. Really it does. Generally, it is in the wild throes of a raging bull market. The last of these was in the internet 'bubble' of the late 1990's. In the residential property 'bubble' of the early part of the noughties, it was also possible in many parts of the developed world.

This is more of a phenomenon rather than an investment opportunity.

Back in the late 90's, if you happened to be in 'the market' it was possible to make 30% per year by holding just about any stock! But if you were in the right stock, then 100% was quite reasonable too. Imagine, owning just about anything that was 'tech' and 'sexy' was a way to virtually print money. That really is a phenomenon.

Of course, it did not last long, and those massive gains were taken back by the market as easily as they were first given. In fact, many of those stock market stars turned into duds and were later declared bankrupt.

The real problem was in valuations. The market was trying to adjust to a 'new business paradigm' which changed the very nature of business for the benefit of us all. Instead of paying customers, 'eyeballs' were the new way of valueing a business online. As we now know, eyeballs don't pay the rent...

For the newer investor, the search for easy money is likely to be a difficult and elusive one. Investment banks, private equity and hedge funds employ highly educated and ambitious MBA graduates to sweat long hours looking for opportunities - they are your competition for profits! If that doesn't warn you, nothing will.

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There are many that sell products in many markets that are targeted solely to a an audience that wishes to get rich quick. That audience usually pays high prices to get nowhere at all. And as with business opportunities, internet marketing, mlm and other easy solutions, the majority do not end up with the money.

What does this mean?

In practice, making money in the stock market is a long-term adventure and needs patience and persistence. If you have funds to invest and a willingness to learn and improve, you can make money. Look at Warren Buffett - he makes lots of it! But he also has incredible skill, patience and dedication. Nothing easy there...

To read more about bull markets, please follow these links:

Bull And Bear Markets

What Is A Bull Market?

What Is Economic Growth?

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