6 Reasons to Be Thankful for The Stock Market This Year
By: Ann Inw
Tags: Investing, 2020, Market, Stocks, Stock Market

6 Reasons to Be Thankful for The Stock Market This Year

#4 Quarantine entertainment

Photo by Aziz Acharki on Unsplash

What a weird year. That’s pretty much sums up 2020. And it’s not even ended yet. As I’m writing this, there are still 8 days to go, and surprises continue to roll in. Exhibit A, that the new covid strain apparently spooks investors.

Despite the roller coaster, 2020 is quite a remarkable year for investors. I wrote about how your portfolio should look like if you made all the right choices on your investment this year. If you fill the criteria, you must be ending this year with a triumph.

(Although fingers crossed there’s no more market surprise at least until the new year.)

I remember telling a friend during the heat of March-April market chaos, “Wealth is created in the recession.” To be honest I wasn’t convinced with that sentence at the time. Regardless, I picked up the discounted stocks. Fast forward 9 months later, I am grateful. It’s not just about the discounts that turned out to be a good deal. There are more.

1. Stocks were at a discount

When I first dipped into stocks, I was discouraged by how expensive some stocks are, especially market leader companies. 2020 changed that.

I’ve always loved any discount. So when I saw many of the stocks have a 60% off, I get myself one — and a lot more.

This discount is what’s encouraging new investors to come flocking in—among other things, of course. It’s a once in a lifetime opportunity, and I’m grateful to be a part of that.

2. It’s easy to get a bagger

The discount was once followed by a once-unthinkable V-shaped stock market recovery. Not only that some stocks recover to their pre-March prices, but many also hit all-time high and rewards their holders with more than 100% capital gain.

This year has produced what people call $TSLA-naires, investors who had modest investment on Tesla by the beginning of the year and turned to be a millionaire as the year coming to an end. It’s incredible.

3. Getting to know new potential companies

This year I was exposed to some new companies otherwise I would never know had the stock market doesn’t have a crazy year. One of them is NIO, which I was first suspected to be just a sympathy stock to Tesla. Other examples are stocks that benefit from quarantines, like Zoom. Funny thing is, I never heard of Zoom prior to 2020.

Not every company is truly a catch, though. The euphoria, especially in the past months, has driven many stocks to crazy prices, regardless of their fundamentals. It’s a situation many would say where even a monkey can make nice profits picking at random stocks.

Differentiating truly worthy stocks from the flaky ones is always every investor's homework.

4. The market is quite entertaining

I’m for one not ashamed to admit that the market craze is what makes 2020 a bit more bearable. It made the quarantine feels less boring. Maybe because I personally am someone who takes great curiosity on how the economy and the market work, and this year there were anomalies to be awed on.

Even for many people who are in purely for the adrenaline rush, this year is quite an entertainment.

5. It’s quicker to open a brokerage account

This year has attracted a horde of new retail investors, and brokerage firms tried to keep up with that.

One of their improvement was a faster registration process. In my country, I remember it used to take at least two weeks until your account ready. You need to send all sorts of physics documents to their office.

In 2020, opening a brokerage account takes only a matter of hours. The second brokerage account I opened this year only takes less than an hour. The verification was done with a video call. In a short time afterward, I was able to trade.

6. March crash, a valuable experience

Some of us are too young to remember 2008, even the ones who have been in the stock market for 5 years or so. 2008 is more than a decade ago, and even to some veterans, it was like a distant memory.

For young investors, now you can pride yourself on getting through a significant crash. There are a lot of lessons from having experienced it. An example, not panic selling during the crash indeed was the best strategy.