All that Glitters is not Gold |
| Written by Ben | |
| Wednesday, 14 November 2007 | |
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All that glitters is not gold Think carefully before you buy Don’t leave yourself dry and cold And bid your money, bye-bye! Our stock market is inefficient. Because of this, the value of a share is not reflected in the price. Overly optimism causes a share to be overpriced; and overly pessimism causes a share to be underpriced. Manipulation, rigging, speculation, rumors, hope, greed and fear are factors causing shares to be greatly overvalued or undervalued. A smart investor has the shrewdness to exploit your emotion, fear and greed. You must have the knowledge and wisdom to combat them. Before you are allowed to drive a car, you must undergo a test to prove your competency. This is because your mistakes can be fatal to somebody else. In the stock market you don’t have to undergo any test. If you have the money, you can just walk into a broker firm, open an account and start playing the market. In fact, the more stupid and naïve you are the more welcome you will be because here your mistakes will be somebody’s gain. Strive for knowledge. Knowledge is better than gold. Happy investing.          |
