Do individual investors in the Malaysian stock market like to buy high and sell low?
There is a rumor that individual investors in the Malaysian stock market like to chase the rise and fall, but have you ever thought about whether this is true or not?
Sometimes what you think is right may not necessarily be a fact, as it only represents your perception. You may have just heard from others, and those others may have heard from someone else. The words of authority may sound reasonable, but have you verified them?
If I compare the above data (taking only examples of individual investors with net purchases or net sales of 50 million or more) and $FTSE Bursa Malaysia Small Cap Index (.FBMSCAP.MY)$ compare:
The answer will be clear at a glance. Individual investors in the Malaysian stock market actually like to buy more as the stock price falls, and they won't sell if they haven't lost money. The higher the stock market rises, the higher the proportion of cash; the lower the stock market falls, the lower the proportion of cash...
You may think that you are one of the few individual investors who have independent thinking and do not chase the rise and fall, but you don't realize that you actually belong to the majority cohort. Do not deliberately select single-day data of individual investors selling during a stock market crash as the truth, because this is just your confirmation bias. You already have a bias and then look for evidence that supports your bias, but selectively ignore evidence that does not support your bias.
If you still don't believe it, you can try recording big data for a year to see how individual investors in the Malaysian stock market actually behave...
You think you know, but the reality is you don't know what you don't know...
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Francis陳政 : Exactly as you said . “Buy at a low price, buy again when it falls, buy again when it falls” is the trading mentality of retail investors.