Can’t Retire on Just Your 401K?

Many Americans across the U.S. worry daily if they can afford to retire. According to Forbes magazine, 68% of workers aged 24 to 65 will not be able to retire on just their 401K. That’s a frightening thought, but one you have to heed. Stock fraud has become one of the big reasons why retiring Americans cannot rely on their benefits. With the help of a qualifiedstock fraud attorney, you can build a better investing plan while possibly recouping some of the funds you lost. Another reason for worry among Americans points to the possible reduction in social security benefits. What was once a given for our parents is not necessarily a guarantee for our generation. Credit card, student loan and other debt can be yet another blow to our financial security as we age. Due to the large debt burden in the U.S., changes will have to be made in order for Americans to feel secure in having their benefits when they are ready to retire. Here is some general information on how to invest.

Profiting in a Bull Market

A bull market is when the stock market goes up at a higher rate than its average rate of growth in past periods. This market is often associated with a positive outlook about the overall economy and the stock market in general. To profit from a bull market, you can use any of the following three strategies:

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  • Purchasing Market Index ETFs

Some ETFs replicate the behavior of popular indexes such as the S&P 500 or the Dow Jones – both of which represent the general outlook of the stock market as a whole. By  purchasing an ETF of any of these two indexes and then selling them at a future date, you can profit in a bull market.

  • Purchasing a Call Option

A call option is a good way to invest in a bull market while limiting your risk at the same time. With a call option, you buy the right to buy a stock for a set price at a set date. A stock fraud attorney can make sure the contracts or terms work to ensure you are actually making a profit.

Profiting in a Bear Market

It’s good to know that you can also make money when the stock market is headed for a fall. Here’s how:

  • Short Selling

As you will see with all bear market strategies, short selling is the reverse of its counterpart which in this case is holding a long position on any given stock. In short selling, you borrow (or sell) a stock at today’s price and buy it in the future when the price goes down. This way, you buy at a low price while initially having sold the share at a higher price.

  • Purchasing Put Options

With a Put Option, you buy the right to sell a stock at a set price (hopefully a higher price than the price of the stock in the future) at a set date. You ultimately expect the price of that stock to go down. This will allow you to sell it at the price that was set initially. A stock fraud attorney can also help in setting this up to avoid being caught in fraudulent trades.

Securing Your Finances – Hiring a Competent Stock Fraud Attorney

It is equally important to invest smartly in both the bull and bear markets in order to ensure your capital is protected. A stock fraud attorney like Thomas Law Group will work for your best interests to ensure your trades are all in check.

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