Monday, March 15, 2010

Bulls, Bears and Sheep

Bulls are those who buy in anticipation of a rise in price. Bears are those who sell in anticipation of a drop in price. But those who sell, may in actual fact, not bears. They may sell because of other reasons, like for example, they may be in urgent need of money or they may have spotted another stock which they think is better and wish to switch counters.
What are sheep? Sheep are neither bulls nor bears. They are followers; they act emotionally on the suggestions of friends or family members or remisers; they are naive, lack knowledge and do not have any strategies to trade or invest.
Sheep normally come in late in a bull market when the market is the talk of the town. They are normally fattened for the slaughter house.