Some investors are passionate about stock speculation and are constantly looking for hot stocks. They buy and sell stocks very frequently, jumping from one concept to another and one sector to another. Their basic starting point is: just don't be the last one to hold the bag.
The so-called last
stick is the highest price. If you catch the last stick, your fate will be very
tragic. It means being stuck at a high position or suffering a huge loss. In
stock market trading, things that are hotly speculated by speculators are
extremely hot. The longer they are speculated, the higher the risk.
Consider stocks that
have a post-tax profit per share of only 1 rupee and net assets of only 2
rupees. Despite these fundamentals, some speculative institutions have driven
the price of these stocks to over 20 rupees. Enticed by the rising stock price,
many small and medium-sized retail investors rushed in to buy and sell.
However, they were caught off guard by the speculators' selling, causing the
stock price to plummet from a high level. In the case of warrants, some small
and medium-sized retail investors blindly followed the trend and became blinded
by greed, pushing the price of warrants up by 1/3 more than the price of the
underlying shares. Ultimately, these warrants became worthless.
As long as individual
stocks are speculated by the stock market, there is usually a manipulator
behind them, which is what retail investors usually call
"bookmakers." When the stock price is blown up like a bubble, the
bookmaker at this time has already completed the bottom absorption process and
is quietly waiting for the taker. As long as someone follows up, the dealer
will take the opportunity to ship and gain huge profits. The stocks received by
those who follow up often have extremely high price-to-earning ratio and it is not cost-effective to wait for
dividends, but it takes an unknown and long time to unwind.
It's easy to say that
you shouldn't be the last one to hold the baton, but it's hard to do, because
no individual investor can accurately predict the price of a stock. No one has
the foresight to know whether or not they are the last one to hold the baton.
You can only guess beforehand and verify afterwards. But once it is proven that
you are the last one to hold the baton, the risk has already occurred.
Even if you're not
buying the last stock, there's still a high risk of losing money when you buy
stocks at high prices. Retail investors generally have profit expectations when
they buy stocks. However, the prices of hyped stocks are always very volatile,
rising rapidly and falling quickly. Sometimes, you see the price go up, but
before you can place an order, it goes down again. And sometimes, even though
there is some profit potential, most retail investors are unwilling to sell
because they haven't met their profit expectations and they watch helplessly as
the stock price slides down and they get stuck.
___________
0 facebook:
Post a Comment