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Riddle: Another 10-letter word for stock discount

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Let’s do a brain teaser: find a ten-letter word for discount. The topic is about stocks and the stock market. Or about a successful investment. Do you have any idea

In any case, the bargains do not fit. The word has eleven letters. But that wouldn’t fit either. Whether our word today fits in this direction is another question. But it’s one that we’re reading a lot about right now and it does have that meaning, at least to long-term investors. Remember, this is a discount for investors who want to invest for years and decades.

The other word for discount we’re looking for…

The word that we are looking for today, and that we can use not as a synonym but with a similar intention, is nervousness. It is often said that market participants are very nervous right now. It is always used in a short-term oriented sense. Or simply overlooking macro market events.

The Ukraine war, inflation and interest rate policy is a triad that is causing a lot of jitters right now and consequently a lot of downgrades. Therefore, uncertainty is one thing above all else: a circumstantial element that leads to volatility. For some market participants, for whatever reason, there is nothing worse than not knowing how the next three to five weeks will play out. Although you never really know.

We can use nervousness as a synonym for discount because this reaction hides something very important. Namely, the company itself and the respective prospects. Regardless of whether it is dividend stocks or growth stocks: there really are a lot of companies that have little connection to Ukraine or are very sensitive to inflation and interest rates. For them, it really is business as usual. And yet, the shares of the respective companies are correcting, which gives us a favorable opportunity. As I said: If we invest with a long-term orientation.

Nervousness is therefore the focus on conjunctural things that weigh on the markets, but not on the company and the opportunity. That’s why it’s my word with ten letters, which we can actually use analogously for a discount.

Nervousness is everywhere!

However, nervousness is everywhere right now. The task for foolish investors now is to selectively seize opportunities where the broader market is clearly overreacting and where clear opportunities loom. There are many good opportunities and discounts can be seen everywhere. So the real difficulty is really making the best decisions for the next few years, maybe decades.

Do not be nervous. The market does that for you.

The article Riddle: Another 10-letter word for stock discount first appeared in The Motley Fool Germany.

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Motley Fool Germany 2022

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