Riding Out the Stock Market Rollercoaster

These are uncertain times for both investors and inventors.

With world events seemingly teetering on the edge of control, will nervous investors pull out of the stock market, leading to economic turmoil even worse than the recession we just experienced? Would people who may otherwise be receptive to new inventions instead be cautious and not take a chance on a new idea?

Unless it’s truly Armageddon, relax! There’s always a way to ride out economic uncertainty – and good inventors can always capitalize on shaky nerves.

Long-term Strategy Beats Short Term Loss

If you invest in stocks, the good news is that you don’t lose a nickel until you sell.

If you buy a stock, and that stocks price drops, you haven’t lost anything until you trade it at a lower price.

Decision resizeWarren Buffet, one of the most respected and successful investors in history, has long trumpeted the philosophy of buy and hold. Do your homework, buy a stock you believe in and hang on.

If you don’t try to time the market’s highs – or panic and sell when it’s low – you climb with the market average.

Over the course of history – including the Great Depression, the 2008 Recession and every slump in between – the stock market averages gains of about 11 percent. What should you do during an economic crisis? Nothing.

Going Public

So if you’re an inventor, how do you know when it’s time to go public? First of all, going public with your invention is not the same “going public” that you hear about when formerly privately held businesses announce an initial public offering (IPO) underwritten by an investment bank to be traded on the stock market.

Going public comes with an incredible list of requirements regarding future growth, profit and assets that most entrepreneurs – and far fewer inventors – will ever meet.

As the following article demonstrates, going public with your invention, however, is about more than just figuring out how to make money for ideas. It’s about timing.

When seeking funding for your new invention, you’re going to have to tell potential investors what it is they’re investing in.

But by going public, you put yourself at risk of unscrupulous intellectual thieves who would steal your idea as their own. Therefore, it is imperative to file for a patent before you go public. This works in your favor in two ways.

First, you protect yourself. Second, you’ll let investors know you have a serious idea that no one else has had before.

Investors and inventors are both at the mercy of global economic, social and political forces that no one individual can control. But barring genuine calamities, they can both play a large role in the outcome of their fortunes.

Be patient, don’t panic – and always protect both your inventions and investments.

About the Author: Andrew Lisa is freelance finical writer. He covers investment strategy and personal finance.