TOO Much Pt. II, The When

So lets finish up our talk from last week about too much or over-investing. Knowing when to invest can be a difficult thing to understand. Some investments may look appealing but they can certainly lead to turmoil if you misread the dynamics of that investment. For example, it wouldn't be the brightest idea to invest in heating oil in the winter. Prices are already high and rising from summer buyers hoarding some of the supply. Going into the summer would make much more sense and provide a greater spread for profits. In the summer prices will most like fall sharply as demand for heat will fall. This gives you the opportunity to buy the heating oil at low prices with low buying pressure and the true profit will be made when the cold weather reaches out and heat is in demand again. At that point you can take your profits during mid or late winter when prices are likely to be highest. That's just a simple way of putting this concept of timed investing. I trade currencies in the OTC market and I had to learn the hard way that not all times of the day are for trading. As a new trader I thought the FX market was a gem because I could stay up all night and all day trading but I couldn't understand why my strategies for certain currency pairs wouldn't work at all for certain times of the day. That is because the market sentiment changed throughout the day from region to region and the perspective I had on the pair wasn't the broad market consensus. I learned to respect my own opinion but ultimately mind the market's.  Knowing when to invest can also help determine how much to invest. If you know that houses are gaining value rapidly and this trend just picked up then go a step further and find out where the housing market just left. Find out if home prices have recently bottomed out or is the worst to come. Maybe the market isn't falling or rising but being stagnant. Once you know this kind of information you can adjust your investment amount accordingly. There's nothing worse than having an investment working against you at the worst time in the market. Equally as bad is the potential losses you can have from having in investment not move at all with a large chunk of your capital tied up in it. Whenever I consider an investment I apply these factors to my plans; Economy, Industry, Instrument. I want to know where all three of these are and how they correlate with my investment and my potential to profit from my investment. Knowing when to invest is not only knowing when a particular market may be doing well or bad but also a way of knowing what amount of capital you should use for that investment. Why buy 100 apples in March for $1 an apple when you can wait until October and buy 400 apples for 25 cent an apple and sell them in march for $1 an apple. So to sum this up, know the price movement timeline (how price moves over time) of the market of your investment instrument, know the same for the instrument itself, and whether or not the economy can sustain those prices for another go-round while you try your hand at it.
Keep your mind happy and keep time in mind, for the sake of your money.