Should you invest during 'ghost month'?
MANILA, Philippines - Traditionally, due to Chinese beliefs, investors and traders tend to shy away from making investment decisions during the month of August, when spirits are said to roam around causing bad luck for everyone.
But as the saying goes, "be greedy when others are fearful."
Investors and traders shouldn't base their decisions on market sentiment alone, according to Fitz Villafuerte, a personal finance blogger.
"I don't think you should base it kasi sabi nila nakakatakot and it's the ghost month," Villafuerte added.
In an interview on ANC's "On the Money," Villafuerte explained that investors and traders should leave emotions and superstitions out when making investment decisions.
"If you give in to the fear and greed, you tend to lose focus on your goals," he said.
According to Villafuerte, the ghost month should be viewed in a positive light. Since prices of stocks tend to go down, it is an ideal opportunity for investors and traders to enter the market.
"If you are an investor and you're in it for the long term, a couple of months every year when the market falls will not really affect your portfolio. In fact, that's good news because prices of the stocks are cheaper so now you can buy it at lower prices," he said.
But Villafuerte suggested that investors and traders shouldn't rely on a temporary market fall alone when buying stocks.
"I always encourage people to do cost-averaging, which is investing just a small amount every month. Because you don't need to time the market, you don't need to study all the charts, you just have to choose the right product that can achieve your goals and then put in money there constantly," Villafuerte said.