Most of us heard of the stock market before at least once in our lifetime. Some of us invested or traded in it either directly thru equity ownership or indirectly thru mutual funds. I believe most of the people who directly traded or invested in it lose money while only a few percentages of people made a fortune in it. Why do most people lose money? Well, that has a lot to do with our personality and basic understanding which unfortunately does not work well with stock market. All of us who traded or invested in stock market have some preconceived ideas on how it works and various factors that affect it. However, some of them are wrong. Let me give you a test to see if your ideas are myths or facts.
Well, let me start first with 10 things that people thought they know (might not be truth) about stock markets.
- Stock market will always goes up on good news and always goes down on bad news.
- When a country economy is good, stock market will be in bull trend and vice versa for bear trend.
- When a stock is going up, the company must be making tons of money and vice versa.
- Politics stability affects the stock market.
- Stock market is a form of gambling.
- If the country goes to war, the stock market will plunge.
- Mutual funds are not related to stock market.
- The stock market will always go straight up or goes straight down.
- If there are more buyers seen at the ticker tape, then the stock will goes up and vice versa.
- News is the utmost important thing when comes to investing or trading.
10 things you don’t know about stock markets:-
- Stock market might goes down on good news and might goes up on bad news.
- Stock market leads ahead of the country economy and its effects are chain reactions to the economy itself.
- A company that is losing money or debt-laden might soars higher than solid companies.
- Politics and market news are just the chain effects and not the actual cause of its movement.
- When in war time, stock market might rally up instead of going down.
- Mutual funds or unit trusts are related to the performance of the stock markets.
- Stock market always moves in the direction of the prevailing trend and will occasionally get disrupted by some correction moves.
- More buyers that are seen at the ticker tape queue might be a mean to deceive the public as the real sellers are invisible.
- News deceives. Most often than not, you will see some strong selling on good news. This depends on the stages of news release. Initially good news will be the bait while the last stage of news is the one that kills the public.
- There are a lot of hard works involved to understand the stock market. It is therefore not a get-rich-quick-scheme. You may be right about the market but still loses money. Knowledge alone does not guarantee your success in the stock market.
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Hi Benjamin,
I ‘ve been reading your blog and found your analysis pretty accurate, mainly on the trends and the outlook. The slack part is your twitters comments seems too short and do not provide sufficient info. Its also a waste that your post have not been updated regularly and thus, it does make one hanging there to think what is going to happen next and that if there is any significant reversal in the trend.
Nevertheless, I need to admit that your analysis was really good but unfortunately, i couldnt make any money because the posting dates are just too far apart.
Hi Christine,
Thanks for commenting on my blog. You are right; I slacked in my blog posting. For a moment, I do wonder if there is anyone out there listening to my blah-blah. With your feedback, I feel motivated to write again. I am working to commit to weekly post with either follow-up with twitter or comment added to the blog post on significant market moves. Time is really short for me as I want to accomplish so many things within a day. Everyday, I allocate some time to research and refine my trading skills.
Twitter posts restrict me to 140 chars, so I try to squeeze all the information into that tweet. I will try harder. I will try to give prompt market call via twitter. Full-post blogging takes some time for me as I have to capture screenshots. By the way, which markets do you trade? Maybe I can be of a little help to you. However, there are always risks inherent to the nature of this investing and speculation business which you must be aware of and take full responsibility.
Keep in touch.