You on stock market? Know about its myths!
Exist several people of myths who strongly took roots in consciousness about the stock market (SM). Ten years` experience on this front and studying of this area on own skin was induced me to write about these myths.
Myth the first. FR is a stock trade, bonds and other unclear things like futures for weather.
Outside really everything looks quite so. However “ from within “ it is clearly visible: FR is a place where trade in the capitals , exchanging them for influence, potrebny for realization of any ideas. That is why this market is called share: funds is the capitals .
For the same reason the enterprise which reached a certain point of development seeks to come with the offer of the actions to FR. The owner of the company sells part of the power over the enterprise, receiving resources for its development. Exit to FR for the company as “ " press;: she sells shares (sometimes it is only records in electronic systems) and receives money for implementation of projects.
Myth of the second. It is possible to earn from FR.
Word “ to earn “ treats performance of work for money. You do some work and receive for it money. In this way only who earns on FR is the exchange. Its work - to connect among themselves bidders.
Other participants of FR earn from something another. Banks - on the payments passing through accounts, investment companies - on orders of clients, brokers - on exchange dealers. Some of exchange dealers are able to earn from rate fluctuations of actions.
Investors on FR not “ earn “. They invest money counting on future profit, and it in a root other activity. Powerful investment strategy are based on the periods when you wait and do not do anything - so about what earning it is possible to speak?
The capital of the others decreases. On Wal - the street goes a joke: “ Whether It is possible to become on FR the millionaire? Yes, if before you were a billionaire! “.
About those who try to get money from fluctuation in prices of FR, say that they speculate on the Stock Exchange . It is considered that such occupation is closer to gamblings, but not to normal work, and it is similar to the truth. Considering FR as some game, it is easy to see that it is game with “ negative sum “: when loses one and wins another, the sum of loss and a prize appears less than zero. The reason is that the bank will take from this money percent for the translation, the broker - the commission for the transaction, the exchange - an entrance fee on the market. And the tax inspection - for an exit from it.
Therefore to achieve success on FR, there are not enough capital and knowledge. Character of a predator is necessary: gobbled up, and without sentimentality. “ To Bolivar not to bear two “ as one of heroes of O. Henry speaks.
FR statistics such is that from one thousand people who began trade at the exchange, three quarters leave with losses in the first year. Two thirds from remained will leave FR with losses within the next three years. Some will leave “ in zero “ or with small profit, having realized that “ It not mine! “
Those who sustained turn in “ iron traders “ with the stable profitability of 30 - 40% per annum based on knowledge, skills and strong nerves. The part of them will go to investment companies, part will open own broker business. Units will remain in itself, “ fearless raiders of share oceans “.
Myth the third. FR - it is very difficult.
Strangely enough, it is the myth too! FR seems difficult: only separate castors and small screws of this device are visible to mere mortals. From business of FR it is very simple: in “ copper “ with money of investors the idea about prospect is thrown. With a sufficient weight of such idea from “ copper “ a large number of the money directed to needs of business is splashed out.
Therefore “ golden rule of investment “ it is possible to call the principle formulated by Peter Lynch: “ Be able to explain, than you own, in five minutes to any “. From the point of view of investments all the rest - trifles.
Myth the fourth. To achieve success on FR, it is necessary to know and spend time a great lot much.
B it the grain of truth is. To achieve success on FR, it is really necessary to know much. But this knowledge does not concern actually FR at all! Paradox? If to remember at all that here trade in the capital.
If you sell the capital, then your purpose - to sell it as it is possible more expensively. And with what pay off you? Here in the course unusual currency - prospect. To understand prospect of the enterprise, it is necessary to understand its business. The general economic indicators can be disregarded almost.
For this reason successful investors do not pay attention to breakthroughs of stock prices, studying indicators of the concrete company. The most successful of them take shares and hold them for years and decades. Therefore traders look only at the movements of the prices, defining a spirit of the " market; right now “ quite successfully applying the trade strategy created at the beginning of the XX century.
As for time... If you understand mobile communication - how many it is required to you time to estimate fifty companies of this sector? If business of builders is clear to you, what is the time you will estimate prospects of the specific builder?
You can successfully invest, knowing “ only “ bases of bases of any business - the Client and Sale. One of the richest investors of the world bought the equity stake of the " company; Tako Bell “ having had dinner them “ burritos “ on the way. It became clear to it who the client and what sales will be. Actions repeatedly grew in price.
And still FR is a work. The cast-iron discipline, the accurate plan and the report are strictly obligatory. And work has to bring joy, otherwise it is necessary to change this work.