Investing is like a dance, you have to be flexible and willing to change, but you also have to be patient and willing to stick it out with your partner. Wise investors find rising markets and pour their funds into them to reap the highest profit for themselves and their clients, but they don’t hold their money there forever. The key is to know when to get out of a fast-rising market before it crashes. There is danger in this, of course, because being too careful in this situation can cause investors to lose out of major profits while they’re running and hiding. Good investors recognize unsustainable growth, that’s why the best investors got out of the real estate market before it inevitably toppled in 2008, and that’s why the best investors got out of the stock market in 2000 when it was ballooning from the dot-com bubble. This is the art of high-stakes investment. When you’re in a rising market, invest, ride the wave and count your profits, but if you know it’s unsustainable, start thinking about divestment before the well runs dry.
The best investors attempt to read the future in their investments. They try to see where the markets are going before they take the plunge one way or the other. The stock market rising to record highs generally isn’t sustainable, if history has taught us anything, so the smart investor will invest for months and then start to divest if he smells fire.
Preston Fontenot is one of these talented investors who isn’t afraid to divest from profitable markets before the winds shift. He is also a business owner and small business consultant.