Monday, December 01, 2008

playing in the stock market would be very new to all of us especially tthose that had just graduated and aspire to be warren buffet the second or george soros the second. the market it seems to me to be very big and often a complex and complicated place to be trading. you cannot much predict what is going to happen nor will you be able to use past pattern to predict what is going to happen in the future. if there is all this true and real stories about what is going to happen ths i guess that economy crisis would not had happen in the first place and that many poeple would not be lossing in the stock market exchange or forex and jumping down from the highest tower. what warren buffett say is really true. risk is only when you do not know what you are doing and this is not only in the stock market world it also happen in your daily life. what i realise is that stock market world and the life around us is all the same. it is just waiting for you to find out the connection in between and bring them togather. they are actually not as complicated as it always seem at first. like my favourite saying it is only hard when you do not put in enough effort in it. well let me give a qoute from the book that i had just read.it is taking about the market and it had suddenly enlighten me that the market is not at all that complicated.
" Ben Graham my friend and teach long ago describe the mental attitude towards market fluctuations that i believe to be the most conducive to investment sucess. he said that you should imagine market quotationi as coming from a remarkably accommodating fellow name Mr. market who si your partner in a private business. Without fail mr market appears daily and names a price at which he will either buy your interest or sell you his.
eventhough the business that the two of you may have economic characteristic that are stable, Mr Market's quotation will beanything but for sad to say the poor fello has incurable emotional problems . at times he falls euphoric and can see only the favourable factor affecting the business. when in that mood he names a very high buy-sell price because he fears that you will snap up his interest and rob him of imminent gains. At othe times he is depressed and can see nothing but trouble ahead for both the business and the world. Onthose occassion he will name a very low price, since he is terrified that you will unload your interest to him.
Mr market has another endearing characteristic he doesn't minf being ignored if his quotation is uninteresting to you today. he will be back with a new one tomorrow. if his quotation is uninteresting to you today, he will be back with a new one tomorrow. Transection are strictly at your option. under these condition the more manic depressive his behavior the better for you.
But like cinderella at the vall you must heed one warning or everything will turn into pumpkins and mice; Mr. market is there to serve you not to guide you. It is his pocketbook not his wisdom that you will find it useful. If he shows up someday in a particular foolish mood you are free to either ignore him or take advantage of him. but it will be disasterous if you fall under his influence. indeed if you aren't certain that you understand and can value your business far better then Mr. Market you don't belong in the game. As they say in poker," if you been in the game 30 minutes and you don't know who the patsy is, you are the patsy." From warren buffet...
very nice and interesting to read it sort of like enlighten me on the spot on what market is about and sort of reminds me on what i usually do when i play a game. in the online game there is always a market where you are able to sell your stuff. you are free to ignore it or take advantage of it. and the same thing applies here that people cant ake advantage of you too if you are not careful. you are the market and the market is you. there are alot of people around to sell things that can help you improve your damages and increase your defences (the same theory as in providing more wealth and also defending your wealth) anyway you can always choose to buy it or learn about the product and think about would it increase the price in the future or the price would actually decrease. but then if you are not in the game for a long time you would actually out of the game. you would need to start all over again to learn about the product that you are going to buy. apply it in you would actually study the price of the product the normal market price before you would actulaly go into it and put your both hand to buy.
lets put it into real life situation. in life when you were to buy something you would actually go around to shop for prices. assuming that we were to take handphone for example. we would actually go from shop to shop to gain information on what sort of model have what sort of function and what is the price of that particular model comparing it with another model and of course with another brand. then you would actually know roughly that if the model for that function that it is offering it is too expansive or it is worth to buy. this it the same for the stock market. but the information you would get would be from the financial statement which you would need to read it though to see if they are earning per stock is on the rise or not. gain a few copany and look through it compare it from the same company that is doing the same business or almost the same business compare the both of them and see. i think that would be the first step to actually know what is the price of a company before even you were to start buying the stock of the company. once you would know what sort of price the company would be at around what time then you would roughly know if the company is underprice or over price at that time. those are the time when Mr. Martket come knocking on your door asking if you are willing to trade this company stock.
There are times when Mr. Market have mood swings (as it happens guys do have more mood swing then females as it is scientifically proven) there are times when he is in the bad mood and it would offer prices that are up for grabs offers that is lower then the market value like sales. malaysia is having the grand sames now and some items might be under value. this is a very personal opinion as some people might think that the product is undervlue and worth buying and therefore would exchange the product with money. but this needed to be think carefully as there are some product even they are on sales they are just not worth buying. even if they are brough they are not useful and this will actually depreciate the asset capital as it does not help to earn or improve efficiency in daily life. when stock market is having depression it is almost the same as the store world wide is having great sales. but it is up to you to pick up your bargain as the value of the product would differ from one to another. study the product carefully and udnerstand the bargain that you are getting into for some are life time investment.
no matter what hapen the final desicion would still be yours. Mr market is only there to offer you with the option but you are the one who make the desicion. so when things goes sour you shall not point finger and say that mr market had con you out of your money. well the reason you would be con is that you had not study the product throughly enough to see that mr market is scaming you of your wealth.but anyway you would still learn from the scam that mr market had laid down for you to understand what you had gone wrong and learn to recognise it next time. (provided that you are not afraid from the last scam to do business with mr market again)
well of course like most marketter would be able to influnce you to do what they want you to do that is to buy their produt. they would be able to list a million good things about their product but if it is really good it is up to you to do your research and find out. do not let mr market influence you in your desicion but instead have your own opinion. and only if your opinion is the same as mr market then you can look into what mr market would offer. I think this would be very relevant to people who have compulsive buying behaviour (especially shoperholic) they should learn to see what they really need then only look out for offer that would enable them to buy the same product with the same usage for less the price that other people are offering. like that they not only able to save more they are able to buy more with the limited money that they got... yeah !!!!
of course in the game i only take onte on what is happening to my character job and what going on with other charcter job i would not be interested because i would not be buying the armour or the weapon that is other job is selling. but then if i were to sell other job weapon or armour i would need to gain such information. so always look into the business that you are relatively understands or expose to. it would be easier to study the product that you already know then to start all over with a product that you have no idea with. same with stock market look into the company that you had already know or being expose to. like that it would save the job of researching into them since you had already always been looking into their news and know what is going on in their company.

thoughful
Jasmin |