The stock market volatility has been unstable for the last two days. The ^VIX (Volatility S&P500) was holding the last couple of days at 20, but it gained 20% yesterday and climbed 60% today. The VIX shows an investor how much uncertainty there is in the markets. As it increases, so does the uncertainty on Wall Street.

For the last few months, I’ve been writing on my other blog, Beating The Stock Market, about how the markets were going to turn ugly, and informing my readers to sit patiently on the sideline to prepare for a day like today. I’ve mentioned how when a sell off like this happens, there is always too much selling of any and all stocks. Other investors are too busy saving their own skin to realize that so many more are doing the same. Causing the price of most stocks to fall below or close to the company’s “book Value”. To figure a company’s book value, look at the shareholders’ equity minus all intangible assets. This will give you in theory, the value of the company’s tangible assets, also known as “net tangible assets. There are plenty of stock market books as well as stock market trading software to assist you in learning more about book value.

The big sell-off started just after 2:30pm and the DOW fell below the 10,000 mark around 2:45pm at which point investors realized that too much selling had occurred, at which point it was time to put in Limit orders to start acquiring more shares. After the DOW and the S&P 500 fell 10%, I started to buy. I may have been a little early but it’s fine with me. I typically wait for the markets or an individual stock (one that I’ve researched) to fall 8% before I buy more shares or start a new position. That is one of my stock market strategies to help me make more money.

Today was a great day to make some quick money in the stock market today, If you’re a day trader, I’m sure you jumped out of those position before the end of the trading day, but if you’re an average investor, be prepared to sell off those share real soon. Like I also stated on my other blog, I expect the markets to fall much further than it did today.

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When seeking investment advice one will also have to be as cautious and weary about the individual or institution that he is doing business with. It is important that the person or the company is duly authorized and license, has considerable experience in the field and most especially working free from personal motives and interests. Some advisers just can’t help taking his own personal motives before that of the clients and that is someone we don’t ever want to have professional relationships with.

One of the common mistakes of an investment adviser that should give you a cue is him being involved in over aggressive marketing. This is characterized by his being restless while talking to you and doing everything he could to sign you in even if you already out rightly refused. Often in these cases, the adviser is guarding the profits that will go straight to his profit and not yours. There are also some investors who utilize and put up soaring leverage just to make up a certain deal, something really unlikely in a rightful investment transaction.

The worst case however is when you see that the adviser does not know half of what he is saying and he is just as clueless as you about the investment you are consulting to him about. You will have to turn your back against him the soonest time possible or you’ll regret for the rest of your life. Learning the stock market investing basics first will help you get on the right track.

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