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High profit-Short term positions comes with high risks

I belive many people lose their money in stock market because of the changes in direction of market in short term. Maybe my views provide any evidences or maybe not, I am just presenting my ideas. I understand that the stock market is a very risky platform if you think of short terms. It is a platform where you build your future if you go for long term positions. If you will follow the model designed by Warren buffet(publically available) you will be in profit most of the time. But in reality nobody wants to follow him, because his model takes upto 10-15 years and everyone wants to get rich soon. Even the biggest winners of short terms end up losing their money. If they haven't they might lose later, because this system is a design where only winners are the long term planners.
If people would have gotten rich in short terms, in all these years there might be people who would have been interviewed in CNBC for their journey to get rich in short term trading.

In a stock market system, the money isn't generated(unless it's dividends). It just switches hands, thus you need to keep in mind that not everyone can will always. If some are winning the equal percent are losing their money. Or you can directly say that, you are winning in short term only because other people are losing.
Company progresses with its stock based on their research and ideas that can provide something(beneficial) to the public, where they start to use it more often(than others in some cases) . Some are fast, example (zoom and AMD) and some are very slow example Google. Everything depends on the demand or how the company creates the demand for its products.

The stock price depends only on the progress of a company, consider the example of AMD, it not only has taken the microprocessor market from Intel but also has a promising future. Now with this information a long term position maker will shortsell the stocks of intel for long term(10years) and buy the AMD for the same period. Will almost end up earning profits depending on how AMD vs Intel competition goes in future. These are the decisions that the huge hedge funds and companies like jp Morgan and others does. If you keep going for the same companies, like tesla and Apple which has a very high volatility, you will lose in the fluctuations. In Warren buffets model, he mostly stay away from the tech companies. Only because of this huge volatility.

However, if you really want to grow your money in short terms(in this case 6-8 months), you need to understand the psychological decisions that people make. I suppose this is what people in moomoo community is trying to explain by their views. I am not getting any benefits from writing these things, but if someone will get it. It was worth sharing my idea. Of course there are graphs and algorithms which shows what position to take for short terms, but none of them works everytime in stock markets, cause the decisions are made people and it is impossible to predict the decisions of people. For example, if someone is holding Apple stock for years and suddenly decides to take out(huge amount) the money to pay for their medical expenses or kids tution. He will take money out by selling apple, this will record in the algorithm as a short sell of the stock, however Noone will buy or claim that sell position and might cause a mistake in prediction. Similar to that person, millions of people make these kind of decision everyday and this cannot be captured by any graphs or algorithms. Thus, I believe only in the macro model of long term investments in stock market.
I apologize for any losses or changes in your decision caused by my ideas.
Disclaimer: Community is offered by Moomoo Technologies Inc. and is for educational purposes only. Read more
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  • Selow BiHi : Very true. As Buffet says, eventually all markets increase. (not all stocks) Large gains and losses may be realized, but trading and investing, to me are two different things. Personally, I believe one should invest for the long term while capitalizing on short term gains and losses. The ratio between the two depends on the amount you are willing to risk.

  • Anonymoo OP Selow BiHi : Exactly

  • Knulp : "Millions of people make these kind of decision everday and this can not be captured by any graphs ot algorithms" can't agree more.  This is why I don't really into the technical analysis, or the analysis is in my head, not on trendlines haha

  • FiveHundredCents : I truely believe that value investing is a great. But it is not easy to do it[undefined]

  • biggestswingndick : The graphs capture live market data and follow THAT trend not trends of what people are thinking in my opinion it’s all analysis and dd

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