8 Things I Just Learned About the Stock Market

 | Oct 11, 2017 | 6:00 PM EDT
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Even though the stock market has notched explosive gains this year, don't for a second think there aren't valuable lessons to learn. 

For this former stock analyst turned digital headline creator, record stock markets mean a daily search for contrarian stories, stories that hit on the hot stock market or just cool stuff that investors need to know about. My newest inspiration comes after sitting in on TheStreet's founder Jim Cramer's monthly call with Action Alerts PLUS members. 

Here are several rapid-fire takeaways that I absorbed while listening to this incredibly valuable call. 

Stop trying to time the next stock market crash. It hasn't happened to any major extent since the financial crisis and in turn, you have probably sat on the sidelines too damn long. The market isn't going to crash tomorrow, so put some money to work in best-of-breed names (like Amazon (AMZN) on this dip). Scared money don't make no money. 

Remember, you can't punch in the word "politics" into a spreadsheet and get a fair value estimate on Apple (AAPL) . What you can do is punch in a series of numbers that produce an earnings estimate and possible future value. Earnings remain the driver of the stock market, not Trump tweets. If the market was truly Trump-tweet driven, we would be down 50% from the all-time highs. 

Record stock prices are an indication that Corporate America could handle the higher rates about to be dumped on their plates by the new Federal Reserve chair. Note that I say higher interest rates -- not an execution misstep on the balance sheet unwind caused by an inexperienced new Fed chair. 

Facebook (FB) and Google (GOOGL) are two names you probably want to own for close to forever. Each have built up impressive moats around their businesses that even at current valuation levels, still aren't appreciated by investors globally. 

Facebook basically owns the internet with Google.

Respect the power of the connected life. The market views Nvidia (NVDA) as a growth beast who has a pole position with automakers and other end users driving innovation. Great place to be in. 

Don't give up on a great company with a meandering stock price in front of events you know will be big-time growth drivers. Case in point is TJX Companies (TJX) : this company will absolutely clean up this holiday season because of people focusing on value and loads of Macy's (M) and J.C. Penney (JCP) stores no longer being in existence. Come spring 2018, TJX will be nicely higher. 

Fear the Wall Street earnings reset. Sometimes Wall Street just expects too much out of historically well-run companies. But even well-run companies experience fundamental shifts in their industries (or internally). Starbucks (SBUX) is an example of one name that may be a tough one to hold into the upcoming earnings report given several challenges it's experiencing. 

Nothing is sacrosanct in Corporate America these days, especially with activist investors swirling. General Electric (GE) is showing all the signs of one that is taking a hammer to old practices under a new CEO, including a possible haircut to the dividend. Expect the unexpected. 

Apple, Facebook, Alphabet, Nvidia, TJX, Starbucks and General Electric are holdings in Jim Cramer's Action Alerts PLUS Charitable Trust Portfolio. Want to be alerted before Cramer buys or sells  these stocks? Learn more now.

Want to join in on Jim's monthly conference calls? Click here for a free 14-day trial subscription to Action Alerts PLUS and hear all of the latest call, plus get e-mails before Jim makes any trade and enjoy lots of other exclusive material.

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