What? You must be kidding, Z !
That was one of the reaction
immediately when I told one of my business associates who is very savvy
in business but not doing so savvy in stock market.
If stock
market is indeed game of prediction, then it is no different with
gambling, was the next disbelief response. Actually I already know that
going be the response. In fact not only it will come from him but will
likely by most people, if not all.
Late last year, stock market brought back some shine to many people.
Many stocks hit new high. This brought back many retail players into
the market. Then not long after that, in January, the market was badly
shaken. In fact, many economists have predicted the economy of the
country will not be doing well long before 2016 greets us. Yes. Many
economists predicted that. And on the same backdrop, many stock market
experts too predicted the stock market won't be doing well in coming
months. There were many whispers predicting December 2015 was going to
be last window dressing exercise to help prop up some stock prices
before headwinds going to hit us in 2016. On the other hand, in the
midst of these headwinds, some analysts predicted which sector of stocks
to invest in to reap maximum profits. Some go as far as to use fengshui
to help reinforce that prediction. Some use technical analysis to
predict the behaviour of stock price. So you see.
Everyone and anyone is trying to predict what will happen to the stock
market in the coming days or months. Everyone and anyone who buys stocks
is based on his or her prediction that stock will perform. With the
onslaught of some many predictions, our hands are so full that we don't
know which one prediction is more accurate than the next one. Many
people failed in stock market because they use the wrong prediction
based on the wrong reasons and from the wrong sources at the wrong time.
If
one predicts December 2015 is going to be window dressing exercise, one
would have high tendency to buy in Nov and sell when price is up in
Dec. This kind of prediction might be true but it is wrong reason to buy
stocks.
But if one chooses the prediction of foreign funds might
be coming back because of MYR currency is so weakened now that it is
cheap for them to come back to our shore, one might consider to higher
the bet based on this prediction.
That brings me back to the
stock that I fall in love this year. I believed in the prediction that
the company will do well based on the information I received and trusted
with good reasons. But it is still a prediction on that of its stock
price performance. No more no less.
http://unclezmalaysia.blogspot.my/2016/02/stock-market-is-game-of-prediction.html
