The Washington City Times’s Jim Cramer on Thursday outlined his dos and don’ts for investing in the current market environment.
If you accept your predicament and stick to these rules, you have a chance to thrive in this brand new market. But if you try to hold on to what worked last year ‘said the host of’ Mad Money ‘,’ I think you’re getting blown up like the people who tried to hold on to dreamers’ internet stocks during the dotcom collapse . “
The Dow Jones Industrial Average climbed nearly 200 points higher on Thursday to 32,619.48. The S&P 500 rose 0.52% to 3,909.52 and the Nasdaq Composite rose 0.12% to close at 12,977.68.
This is a tricky situation, despite the positive day for stocks, Cramer said, with the market showing a week-long downtrend. Whenever the market turns, investors go through the five stages of grief: denial, anger, negotiation, depression, and finally acceptance.
“We’ve now made it… to depression, even as the averages recovered nicely this afternoon,” he said. “This is when a lot of investors tend to raise their hands and give up the entire asset class.”
Below are his tips to help retail investors get through the current situation: