Category: Money Tips Date: 2007-05-03
Soros Investment Tip of the seven: invest in an unstable state
Market refers to instability when market participants expected the deviation between the objective fact to reach the extreme state of the market in reaction to a certain degree of self-propelled, it is difficult to maintain and self-correcting, so that the imbalance in the market developed into a very serious the extent of the market at this time was unstable.
Imbalance in the market formed by the state from the mainstream market expectations tend to be objective reality, a strong contrast to the sober market investors began to reflect this bias, tend to challenge the mainstream market Ershi the dominant factor in changing the original too fragile, but the market trend of inertia so that the original enthusiasm. Ebb, extremes meet, Soros investment success is to know how to discover the secret of one of the unstable state of the market to capture the phenomenon of rise and fall time.
For example, occurred in the mid-80s a case the tender bidder's offer to re-evaluate the company's assets, so banks give more loans to other bidders, allowing them to bid higher and higher. Finally, the tender prices had surged, the market is overvalued and due to become shaky. According to Soros's theory, the collapse will be inevitable. Greatly increased the possibility of success or failure occurs, unstable state of the market provide an opportunity for investors.
Around us, sometimes we rise and fall of the cases, the United States rose to 1000 when the soybean market forecast to reach 1400,1600, cattle potential to develop into the latter part of the price beyond people's expectations, there has not made the top of the bull market psychology, which when soybean stocks are extremely undervalued, soybean prices have been greatly exaggerated elements of virtual value. Eventually rise and fall phenomenon, soybean prices plummeted, domestic importers have defaulted due to high imports of soybeans to make oil companies to re-shuffle.
Grasp the ups and downs occurred in the timing is also very critical because when the market is often a strong bias of the mainstream, the lethality is relatively strong, and only take the appropriate investment strategy, there are plans to Jiancang in order to take full advantage of this precarious state of the market bring us investment opportunities.
