Investors Are Growing More Fearful of the Stock Market. Warren Buffett Has 6 Words for Moments Like This.
Written by Katie Brockman for The Motley Fool -> Investor sentiment has been steadily dropping over the last month, even as the market hits record highs. Your investing strategy right now could make or break your long-term earning potential. Major market indexes may be reachin
Investor sentiment has been steadily dropping over the last month, even as the market hits record highs.
Your investing strategy right now could make or break your long-term earning potential.
Major market indexes may be reaching record highs, but many investors aren't feeling optimistic right now.
The CNN Fear & Greed Index, which measures investor sentiment over time, has been steadily dropping over the last month. On May 1, the index peaked at 71 -- firmly in the "greed" category. By mid-May, it had dropped to 63. As of this writing, it sits at 55. While that's still in the "neutral" category for now, it's inching its way closer to the "fear" side of the spectrum.
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To be clear, this doesn't mean that a recession is around the corner. But if you're feeling nervous about investing right now, you're not alone. Here's Warren Buffett's best advice for situations like these.
One of Warren Buffett's most timeless pieces of investing advice is to "be greedy when others are fearful." In other words, when other investors may be tempted to get out of the market, that's the best opportunity to dig in and invest more.
He offered this advice in a 2008 opinion piece for The New York Times , when investor sentiment was at rock bottom amid the Great Recession.
