Category: Money Tips Date: 2007-02-22
The stock market there are two seemingly conflicting principles. Law 1: The stock market does not have not been conquered heights. The long run, the economy is always under development, and as the enterprise property right certificate of stock, and its value is always growing, the stock price will naturally continue to record high as the value of the stock. In this sense, as long as the long-term investors buy stocks to hold the stock, he can always make a profit. In other words, this principle is: the long term, the stock market is always greater than the total amount of money to lose money in total. This is the stock market with gambling, futures and options, the game is different. The reason is that the stock market-owned enterprises as a new profit source.
Law 2: The people who make money on the stock market in the minority, while the majority of the people lose money. According to the survey, China's two stock markets opened nearly 10 years, lose money for investors accounted for over 90%. A more typical example is from July 1985 to February 1990, the Taiwan stock index rose to 12 682.41 points from 636.02 points, while investors lose money over the same period more than 90%.
These two laws together they tell us: the vast majority of people are losing money on the stock market, and only a few people can make money. This part of a small number of people can not earn double the money, a long-term rise in the stock market profits, and the other one is that most investors losses money. These are often a few make money not because of the strength of their capital, but because of the correct investment philosophy.
From this law we can draw two conclusions: the stock market is a deceptive market, which uses the weaknesses of human nature to induce investors to chase high-kill low so as to continuously lose money.
Characteristics of the stock market lie on the volume that is reflected in the bottom of the head a large quantity of small volume. In general, people buy things, when higher prices, fewer people buy, the price lower, the more people buy. In the stock market, stock prices up faster, stock prices higher, the more people buy, the greater volume; stock prices lower, fewer people will buy volume is also smaller. Exists between such a large difference, because people buy things in order to consumption, while most of the people buying stocks in order to re-sell. Therefore, the stock rose faster in the future more people will think it can be up, the more the buyer; while stocks tumble faster in the future more people will think it can be dropped, the less buyers. Stock speculation became "Fools Game", each chase sell into fools believe that it is even more silly than his fool to pick his baton, which made him a wise man.
Countries of the world stock markets, both developed and developing countries, whether it is a long history of the U.S. stock market is still emerging Chinese stock market, are unable to escape the head volume, the bottom of the small amount of fate. No matter which country of the investors can not escape the deceptive nature of the stock market. (Your opponent on the price of the stock held by the program satisfied? You think a reasonable price should be the right number? - Soon send short �letter to vote! Write "JF01 or JF02", 01 on behalf of "satisfactory", 02 stands for "unsatisfactory." Mobile users sent to 2.9116 million + stock symbol (eg, 2911600600104), China Unicom users send to 9.9016 million + stock code)
So, how to make money in the stock market to become the minority? Since the stock market has been the number of theory and practice abroad who tirelessly search for price changes in the law and made all kinds of "theories" and "laws" in order to beat the stock market. Unfortunately, these "theories" and "laws" are either too difficult to understand, difficult to be accepted by the general investing public, and use; either too straightforward, everyone is available, the characteristics of the stock market and decided that everyone can make money, and thus also determines these "theories" and "laws" once commonly used by the investing public, these "theory" is no longer correct, these "laws" would cease to exist. This is I, "The Way Road, very Avenue," the truth.
Up and down the face of a sharp price fluctuations in long-term trend chart, flash your brain first thought might be a buy low and sell high, through the short-term operation in the short term riches. Unfortunately, hindsight easy to make, can you bring this idea into the stock market, the stock market's deceptive and your combination of human weakness, you will find that you buy low and sell high to recover the original intent was to become a high and low kill reality. Faced with this outcome, you can not blame your dumb, blame the stock market is too cunning. Do you want to play the stock market, eventually playing a game must be your own.
Can be said that most people lose money on the stock market the root cause lies in its speculative mentality. Eyes staring at the stock speculators only difference, but completely forgotten the ultimate determinants of stock prices - a dividend. Speculators often joke investors simply concentrate collected Sesame (dividends) and lost a large watermelon (stock price difference). In fact, the bonus is small, it is to determine the underlying stock. Therefore, investors seemed to be "picking up sesame seeds and lost a big watermelon" is actually a fundamental grasp of things. In which the truth and we need to understand. In fact, the stock market are all making big money investors. Buffett is an outstanding representative. Unfortunately, his investment approach is too professional, non-retail investors could follow suit.
