Tuesday, July 11, 2006

Tips for Thoughts

Hope, Greed, and Fear control the market
Hope causes you to hold on to a falling stock
Fear causes the market to be oversold
Greed causes the market to be overbought

Stupidity abounds in the stock market
Buying a counter because of its name is one of them
A company with no earnings and high gearing is best avoided
Buy someone’s problem, and you are damned

Ride with the bull
Raid with the bear
Benefit from manipulators’ effort
Monies are here and everywhere

The rich accumulate at bottom
The smart distribute at the top
Amateurs buy all the way down
Professionals do it the other way round

Be quick and bold when an opportunity arises
Those who hesitate will lose the gain
Though good things come to those who wait
Opportunities neglected, seldom surface again

People mad with power are those that God wish to destroy
Stocks pushed down are what the smart wish to buy
At the top, equities are the strongest and most tempting
Don’t be lured by them, lest bid your money farewell! Bye-bye!

Consistent winners are hard to find
Learn from them; learn their strategies
Improve and upgrade yourselves
And you will be fine.

Every dog will have its day
Every stock will have its play
A stock that already has its prey
Is not worth looking at in any way.

Easy money is not easily made
One win does not a winner make
If you want to be a day trader
You must learn the trick of the trade

Housewives look around for a bargain price
Be they some foodstuff, groceries, dresses or the like
In the stock market, they are not so bright
Upon a tip, they buy, without knowing whether it is wrong or right.

Monday, July 10, 2006

Go With The Flow

The stock market is full of dummies
Foolishly parting with their monies
Buying what the smart wish to dicard
Remorseful they will be, at the very start
Soon they will feel the pain
For all the money they have paid
There is nothing to gain
They sell when it's time to buy
And buy when it's to sell
Buying blue chips at the top is foolish
Selling them in their bad years is stupid
Follow the trend you must
Never go against it
Go with the flow
It's the surest way to grow and grow.

Sunday, July 02, 2006

Why do share prices move up and down?

Factors, many and varied, affect share prices. Below are some of these factors:-

Earnings (present and future)
Mergers and acquisition
Change of ownership and management
Interest rates
Government policies
Political unrest
Lack of co-operation between countries
Natural disasters such as severe drought, floods, and epidemic
Commodity prices
Emotion and sentiment. .

The above factors are forever changing. This causes the supply and demand of shares to change as well. When demand is greater than supply, prices rise. When supply is greater than demand, prices fall. The greater the difference, the greater is the velocity.

When people are optimistic, they become overly optimistic. When they are pessimistic, they become overly pessimistic. That’s why shares become overpriced sometimes and under priced at other times. Smart monies know this. They are able to exploit these situations.

Never get married to your stocks. When they are very much overpriced, they must be sold. You can always buy them back when they are down.

Investment in knowledge will pay the most dividends. You must invest wisely to win.

Happy investing.