In the wrong market, doing the right thing
Poste par mabinogi32 on March 20th, 2010Investment: in the wrong market, doing the right thing 2008-09-11 16:30:17 Source: (This article Source: First Financial Weekly, Author: Cui Peng)
market is not reliable, in order to “love the market, even if the It hurt your heart “is not easy.
by virtue of a person’s ability to invest in order to overcome the market is difficult, although we have a variety of investment tools, but if you want your investment rate of return than the market growth rate, the most important The secret is to make mistakes when the investors in the market continue to choose to do the right thing.
Do not be “Mr. Market” mood carried away
market is formed by investors, that the other investors beat the market - from a statistical sense, said other investors - a time when mistakes you have to follow to avoid mistakes. And why do other investors make mistakes? Many of them, and profound lack of financial knowledge and investment experience, the originator of value investing in the stock market made a Graham Mr. Market metaphor, this metaphor in his students that Mr. Buffett’s 1987 shareholder report also has been mentioned, meaning that only two had in this market, one is you, another person is Mr. Market.
we may assume that you and “Mr. Market” is the company’s two partners, if not out of accident, Mr. Market will quote a price every day, he is willing to buy at this price for your shares or his Shares sell it to you. Mr. Market is a very emotional person, and his offer will be with his emotional volatility. Sometimes, he only see the sunny optimism, will report a very high price; while at other times, in his view to the end of the world soon will be a very low price quote. So for investors, and useful is the “Mr. Market” and wallet, but not his emotions, but things are often the contrary, the people, “Mr. Market” and more interested in mood and behavior of his worship.
Do not talk like lemmings
reportedly living in the cold of lemmings each spring migrate in search of food, but with every passing in 2034, lemmings will appear as a collective surge in the number of non-rational state, in the the way a lemming migration of panic quickly spread to the entire group, and when they migrate to the sea, but also because a small group jumped into the sea, the impact of the collective jumped into the sea, until exhaustion and died. Zoologist for the behavior of lemmings do not understand the mechanism, but the behavioral finance scientists have more than one occasion to use it to describe the behavior of equity market participants.
In addition to simple and stupid herd mentality, institutional investors, especially public offering fund managers are sometimes aware that the market might have gone wrong,buy mabinogi gold, but if they use this error to reverse investments, are likely to occur The result is that their investment in the short term average, worse than the market, which will direct threat to their jobs and income, therefore, from the rational choice, the fund managers are more willing to commit a popular choice error, do not want to risk selection alone correct. Like lemmings, as they prefer to follow the group jumped into the sea, it would not choose to face the loneliness.
from the time point of view, the United States in 1900 to 2005, GDP increased by 11 times (according to 1990 U.S. dollars converted Kai Gai, that in 1990 U.S. dollars as the metric), while the U.S. stock market fell during this period of year is more than rise in the first; If the stock market is a barometer of the real economy, to one year time units, the barometer of the wrong time to be more than the correct time, which means most of the time the market may be wrong.
concerned about those Dao Meigui
in the wrong market,mabinogi gold, there will always be Daomei Gui, such as some quirks, but the performance is also good company; or some other good companies bad environment, they are deeply misunderstood by the market, it image and the bath water with the baby being thrown out of luck, like. If you have at this time is different from ordinary people to go focus on these Daomei Gui, you will also receive excess returns.
have quirks of the company’s first to give it, such as the United States as the first exhibition company, is designed to deal with love and unnamed dead. The company’s main business is a display of some strange, like they had a medical professor from China, where access to a number of unidentified bodies, after some special treatment, they get the bodies to do live corpse exhibition in New York - I really do not know that they are not those guys disguised as bodybuilders Hunguo customs. Although this show a lot of people interested in commercial profit and good, but the thought of the company’s business is it, it could not help but disgusting. It’s a bit like a person again performed affinity, but he has the habit of collecting women’s underwear, you will also like him? But having said that, This is really a valuable company, they have 20 million U.S. dollars in the bank deposit, cash flow for the 17 million U.S. dollars. The company also holds 1,500 victims of the Titanic’s policy. Because of this, they are kept in the seabed mining, which now have been found at about 100 million U.S. dollars worth of items, is expected to recover the total value of the goods may be one billion to three billion U.S. dollars between.
in China’s listed companies, can display a quirk is not a lot, because even if the company’s management really have the habit of collecting women’s underwear, their business seems to have remained as in the maintenance of world peace and save humanity . It appears that one is not enough freedom and effective market niche has been the depth of excavation is not enough, this sentence can also be the contrary, there is a peculiarity of listed companies is the capital market is likely to be more perfect.
master how to do
Now everybody says Peter? Lynch is the world’s “best financial planner,” Lynch investment in support of that miracle is that several companies Fannie Mae, Chrysler, Wal-Mart fertile. With regard to Fannie Mae is much more to say, since Lynch retired in 1990, so he might be difficult to expect that there will be so expensive when oil and Fannie Mae would be deeply trapped in the sub-prime crisis.
in the 1980s, due to the impact of Japanese cars, when the U.S. stock markets have no confidence in the automobile industry, especially the United States’s third-largest car maker Chrysler is expected to bankruptcy, the stock only sell two U.S. dollars, Lynch was in this optimistic about the automotive industry began when he found that Chrysler’s situation is not so bad, on the contrary it also has more than one billion U.S. dollars in cash, the money sufficient to ensure that it will not be bankrupt within two years, and all production operations are not particularly negative problems. So Peter? Lynch and decisively to buy Chrysler stock a large number of its entire public offering positions at that time the fund has reached the statutory limit of 5% — Magellan fund’s assets.
Lynch in September 1985 an international research activities, he scored a major victory. In Sweden, he went to the country’s largest car company Volvo, and was surprised to find that only a Swedish research institutions, securities investment analyst has simply not been to Volvo the company. At that time, Volvo’s share price is 4 dollars, while Volvo has been as high as four U.S. dollars per share in cash. Lynch then quickly bought Volvo, and that the emergence of this “Dao Meigui” was the reason for Europe’s minds are smart to consider the philosophy and the arts, and almost the only do the securities analysts.
is Chrysler, Volvo, of course, and later the Ford, which she was not being optimistic about the “unlucky company” to Lynch in a short time much easier to earn 1 billion dollars.
hit banks in the market Nishajuxia idea
time, many prominent companies are also being sold under the panic, because of the economic boom cycle of reincarnation is difficult to fathom, it is difficult to see the direction of investment, so the whole market on the similar to the one Dao Meigui. If you need to buy the entire market, in addition to other index funds, more aggressive investors may be able to buy banking company.
the entire financial sector will definitely be with the development of the real economy, the development, because of the role of the financial industry, the financial development of the industry faster than the trend of the real economy has become increasingly evident. As a single enterprise, banking company in a free competitive market as leverage, the risk that unlike other industries the company is small, while in China the situation is somewhat different, because the government needs to control the country’s economic lifeline, the large commercial banks enjoys the same reputation in the nation’s prestige, but because of more complex social reasons, these banks would not go bankrupt, even though they sometimes occur temporarily high bad debts, they can also receive state financial Bozhuan.
state-owned commercial banks only with the development of China’s economic growth, it is certain that if a stable operation of banks in China can, in a few years can certainly become a super-large companies. While this cost is the relative loss of banking activity, but in the rapidly developing economy, this contradiction is not obvious.
due to years of national credit application, the state-owned banks have a more conservative mode of operation and business risk control, such a system to reduce the desire of the banking and financial innovation, so that banks lack vitality. However, the rapid development of stable economies, state-owned banks is no doubt an excellent mouth-watering good company.
in China, if the market has become Dao Meigui, then investors can take advantage of cheaper to buy outstanding shares of banks, so that they speed to keep up with the asset value of China’s economic development.
mindful Black Swan and I have four individuals
bet whether Liu Xiang won the title at the Olympics again, but the result is that we do not think, that is, Namu Xi? Taleb said the black swan event bar .
then we look for such a small probability event. In fact, Liu Xiang’s withdrawal race itself for most people there is no physical impact - unless you are very sad that the coach crying, or you are a sponsor of those unfortunate.
But I bet other people playing, but also four, so I put the real economy, the securities similar to those of investment banks, bet should also be regarded as a kind of financial innovation, and I would expect to get from this financial innovation good benefits. Liu Xiang and the race back a small probability of such incidents before the game, I simply do not believe, if someone, and I play this bet, I would put odds down to 1:10 to the temptation that fool fooled, but it should be the phrase old saying, laughing In the end, to the best laugh. Only a small probability event occurs in the end we know who is the fool.
In this case, I should do it, like I should buy that insurance, but even if it was sold in this user-friendly insurance, if such a small probability event occurs, the insurance company will be bankrupt exclusions.
still remember that in the sub-prime crisis made a fortune in the AdvantagePlus fund manager Paulson do? He is due to short the sub-prime mortgage insurance only earned more than 30 billion U.S. dollars. In the case of economic downturn, because many investors the shadow of soul, there will be more irrational events, really black swan fly the streets.
If you are not the risk of fanatical hobbies are, maybe a little bit Mo Buzhun in the market when the betting should not be everywhere, thus reducing your leverage ratio; but if you have played bet, maybe you should re - fill a few dozen bet, such as your original bet he wins, then again he lost betting on the next few note bar - it sounds like a bit of God God Tao Tao.
We could use the house to give an example, if you have two houses, in the case of an unknown market, how you should dispose of them?
A, the two houses to sell
B, to sell one thing and maintain a
C, two sets of houses do not sell the whole practice of
A and C are the hope to make big gains, but the risk increases. In the black swan-infested era, perhaps this is unwise, because those small probability events, such as the collapse of the real estate market, or real estate are likely to experience sharp reversal of straight up. May choose B is more suitable, if the real estate market continues to rise, you will earn more real estate holdings; and if the real estate crash, you can buy at a lower price of your original house, to do more for the future revaluation good preparation. In this way, you can always Buzhi Yu exposure to the worst state, and thus have the upper hand.
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