Investors are in a slump. Is It Time to Be Greedy?

Investors are in a slump. Is It Time to Be Greedy? ...

The last time increasing interest rates made investors feel nervous was in 2018, when the Federal Reserve hiked interest rates four times between March and December while lowering bonds on its balance sheet.

Sound familiar? The Federal Reserve is using the same playbook this year, although they are more aggressive.

The Federal Reserve has already raised interest rates by 0.75 percent, and earlier this month, it announced that it would begin reducing the number of mortgage securities and Treasury bonds it owns starting in June.

The Dont Fight the Fed adage has contributed to a nearly 30% decline in NASDAQ stocks from the November peak. However, the S&P 500 has significantly improved, but its Treasury bonds have gotten tough hit. For example, the iShares 20-year Treasury ETF (TLT) - Get iShares 20+-year Treasury Bond ETF Reportis is down over 23%.

However, the decline in indexes does not hint at the market''s worries this year. Several currencies have performed much worse. For example, the cryptocurrency exchange Coinbase (COIN) has dropped 88 percent, and the Finnish charging Upstart (UPST) - Get Upstart Holdings, Inc. Report has lost 92 percent of its value since its peak in October.

The level of pessimism is rising, so you may be concerned about what to do. If the past is prologue, then 2018 suggests shopping for bargains.

Big Winners Emerge From Wreckage

When everybody else sells them, it''s difficult to buy stocks, but doing exactly that has paid off for the past year, even in 2018.

In 2018, the SPDR S&P 500 ETF dropped 20% from its September high until December 31, whereas the NASDAQ 100 (QQQ) - Get Invesco QQQ Trust Report - a tech-heavy index comprenant 100 large-cap stocks - lost 23%.

Following a drop in their account balances in three months, investing in the fray back then was likely the last thing investors wanted to do.

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Although purchasing stocks during that painful sell-off proved to be profit-friendly pretty quickly. For example, the NASDAQ 100 was trading at $173 at its highest point in December. If you were unlucky enough to purchase at that price, you still broke even by the end of February 2019 and were up 10% by April, and you would still be up more than 68 percent despite this years drop.

Amazon (AMZN) - Get Alphabet Inc. Class A Report, Microsoft (MSFT) - Get Microsoft Corporation Report, and Apple (AAPL) - Get Apple Inc. Reportare up 64%, 131%, 172%, and 289%, respectively. Youd still be up an eye-popping 1,137%, despite an over 40% decline since November, if you purchased Tesla (TSLA) - Get Tesla Inc Reportat the lows.

These are shady returns, but they weren''t brought down quickly.

A buyer in the market wreckage takes care of steel and a willingness to be wrong short-term in exchange for a long-term return.

How Do You Play the Market Now

The bear market will be the biggest winners in 2022, but it takes time to look beyond America''s future.

When he wrote in the Berkshire Hathaways Annual Letter in 2009, Warren Buffett thought it at its finest time in the financial crisis.

Amid this bad news, don''t forget that our country has faced far worse work in the past. In the 20th century alone, we dealt with two major wars (one of which we initially appeared to be losing); a dozen or so panics and recessions; and the Great Depression of the 1930s, when unemployment swanked between 15% and 25%. America has had no shortage of difficulties before adding, and America''s best days are preparing.

He was perfectly honest.

The S&

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