How greed and fear works in sharemarket/trading?
If everybody who is having high IQ and money can make money in sharemarket means there wont be any losers. To be a winner/gainer we have to be disciplined. Greed and fear should be in our control. We should not be in greed, fear's control. We are the king/queen of our own emotions. Let us see how fear and greed take control of our trading with an example.
There were two friends A and B. A analysed a stock and bought it at 200 level. He said to his friend B about it. A exit from the trade at 300 level gaining 100 points. B realised it was a good trade and bought the stock at 300 level and exit at 500 level gaining 200 points. Now A bought the stock at 600 level. Stock started to fall but he was waiting for the upside movement. Finally he realised his mistake and exit at 300 level with the loss of 300 points. Now A's total loss was 200 points. B's total gain was 200 points.
People who dont know about trading/stockmarket will say A is unlucky and B is lucky. People who are traders/investors will say A's loss is because of his fear and greed even he has good analysing capacity. What is your opinion?
There were two friends A and B. A analysed a stock and bought it at 200 level. He said to his friend B about it. A exit from the trade at 300 level gaining 100 points. B realised it was a good trade and bought the stock at 300 level and exit at 500 level gaining 200 points. Now A bought the stock at 600 level. Stock started to fall but he was waiting for the upside movement. Finally he realised his mistake and exit at 300 level with the loss of 300 points. Now A's total loss was 200 points. B's total gain was 200 points.
People who dont know about trading/stockmarket will say A is unlucky and B is lucky. People who are traders/investors will say A's loss is because of his fear and greed even he has good analysing capacity. What is your opinion?
Comment:
Dear friends, please share your views.
Comment:
Instead of person A & B, if you read this as one single person's trading, you can understand how fear and greed works!