Wednesday, 15 April 2015

Players in The Stock Market



There are basically four types of players in the stock market, each  struggling to make money base on how he/she understands  the market, they are the bulls, the bears, the chickens and the pigs,  each of this types of players  are named base on how they behave in the market,
·         The bulls: the bull buy stocks when everything in the market is good, people are finding jobs, gross domestic product (GDP) is increasing, consumers are spending money and stocks are rising. An investor who thinks that certain stocks will rise is said to have bullish outlook and will purchase stocks thinking that he will sell it at higher prices and he is said to have bullish outlook. An investor with bullish outlook is optimistic, they always predict   goods thing about the   market and expecting to benefit from it. However bull market does not last forever and may lead to losses to investors if   stocks are overvalued.
·         The bear: the bear is when stocks values are declining, the economy is bad, unemployment is high, recession is looming and stock’s prices are falling. It start with a sharp drop in stock prices though the trend may change and stocks may begin to rise slowly, but will continue where stocks will be falling continuously, it is very difficult for investors to pick stocks in the bear market, An investors who think that the market will fall, is pessimistic and is said to have a bearish outlook. You can make money in the bear market in two ways, either by cost averaging or short-selling or you wait till when the bear market is nearing end to buy the stocks in anticipation of bull market.
·         The chicken: The chickens are those set of investors that are afraid to invest in the stock market. They are fearful and very suspicious of the even the bull market, they invest only little and therefore receive only little profits; the chicken has the desire to invest but their fears overpower their interest.  They are afraid take any form of risk and therefore turn their attention to the security market or simply get out of the market.  Though it is advisable not to invest in what will make you sleepless but with zero investment you are guaranteed zero returns (profits).
·         The pigs: pig market is a high risk big score or big loss positions, they are greedy and emotional about their investment and often get slaughtered in the market. Pigs also called the prone-risk investors; pigs are the get-rich-quick types of investors and   can jump into any stocks without conducting the necessary research.  They are impatient and greedy and are ready to pick stocks on hot tips. It is mostly from their losses that bulls and bears make the money.  They are referred by professional investors as the passive income generators (pigs).
 For you to succeed in stocks business you have to pick between  the bull and the bear , because the bull makes money, the bear makes money, the chicken run away while the pig just get slaughtered.

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