Saturday, January 19, 2013

Chasing the trends; Good or bad?

     Stock market is indeed a place of chasing trends. It is the human nature that he would always run madly behind the trends of times.  Once the media get overwhelmed with the news that the gold price is going up and it is supposed to break all-time records, people start cursing, ‘why we couldn’t  have deposited some money in gold while it was available at a lower price’. 




 In no time, they would set out for buying some gold or for investing any gold based deposit schemes or mutual funds.  Wherever the public attention concentrates, crowd start flocking that direction.  This is the common scene and it is the nature of human mind.
     As we all know, the most memorable part of our life is the college life. No responsibility, no burdens, besides, having fun with friends, getting involved in various campus based entertainments and what not!  But the real sense of the campus life we recognise is when we passed out of the college.  However, in future, many of this college experiences help us to confront and overcome several crises in the life. 
     My way to home from college, those days, was usually in a passenger train.  There was a funny guy in our college, who used to make jokes with the employees, who were walking briskly, after getting out of the office however in order to board the train back their home.   Though the guy reaches the railway station as early as 4’o clock, he would wait until 5 as the employees finish their duty at the time.   When he sees any of them behind him pacing towards railway station, he would start yelling ‘the train comes’.  As he runs ahead, people also would run behind him.  It makes a huge crowd running towards the platform only to see nothing but empty tracks in front of the platform.  I saw this funny game many times and the same fellows were repeatedly getting mocked by the guy many times.
      Let me narrate one more folk tale about Nasardhin Hoja, who told lie to several people that there was the free supply of Biriyani at the abode of a landlord who stayed nearby. Believing Hoja, people started running towards the mansion of landlord.  As the huge crowd running towards the same direction, even Hoja himself, surprised, confused and started chasing the flocking crowd.  When one of his friends, who knows that Hoja was lying about the supply of Biriyani, asked him why he too was running to the mansion.  Hoja, with a big grin, replied. ‘If there is no supply of Biriyani, why all these people are running madly?’
     Exactly this is what the human mind.  Everyone, without the hope of any benefit, would desire to run along the way all others are running. Thinking 'if there the supply of Biriyani ...'
     If we closely watch to the stock market, we can easily note that, the same is happening there as well.   At the time of a recession, as the liquidity rate turns very low, all the stocks are available at a lowest price in the stock exchange.  But none is interested to buy them as the people are not flocking towards that direction or they are not even talking about it.  Because none likes to stay where there doesn't have a huge crowd.  At last, only when the market got warm and it catches the public attention as the media profusely celebrate the market booming, people start thinking to invest some money or they would start cursing themselves about their missed opportunity.  
     Most probably the crowd may be too late in their action. Most of their selection for the investment might turn wrong.  A majority of them would end up losing money.  Utilise the opportunities in the right time. Indeed the success will be with you.

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