Fear is a vital emotion. It’s our brains response to potential danger. Without it, we couldn’t protect ourselves from legitimate threats. But fear can get out of hand. It can hold you back. A strategy for dealing with fear is essential if you want to do anything that involves a risk.
Fundamentals impact investor psychology, and investor psychology has a big impact on asset prices. I’ve been writing a book on this and have recently reviewed the draft, so the concept of investor emotions having an impact on price is top of mind for me.
Study the charts in this update carefully. They give you an insight into the market’s rhythm. I believe these could be some of the most valuable pictures you ever see.
I guess you can’t really blame investors jumping out of active and into passive investments. One passive vehicle growing in popularity is exchange traded funds (ETFs). Should we all just buy ‘the market’ and be done with it?
One way to cut down your search is to focus on characteristics that many rising stocks have. That’s why today, I’m going to show you how to use your time effectively to try and find some of the very best stocks on the ASX.
The amount of money hedge funds control exceeds US$300 billion. In 2012, this figure was closer to US$39 billion. A real question has to be asked. Do we even need hedge funds?
My aim is twofold: identify profitable trades for you, and develop your trading skills. People naturally think about the first goal. But the second is just as important.
Today, asset managers are again changing how they look at stock. Not only are they looking at charts and earnings expectations. Fundies are using mathematics to find non-correlated bets, risk adjusted returns or factor-based models.
There are no certainties in the market. But buying the market (it depends which market) is something that Warren Buffett often instructs his followers to do.
Companies like REA and Altium are not worth an unlimited price. And this is the hard part of investing: determining whether you’re buying a bargain or piling into an inflated multiple.