The Winning Probability

I find it intriguing how incredibly unpredictable markets and business in general can be, where instating that something as concrete proof is just as big of a no-no in the world of business than it is in the sciences.

Turning to the business of markets, stocks and the general philosophy behind picking winners (the Apples and the Microsofts) drives the world of investment. This inherent desire, whether based off greed or some other factor has resulted in a general trend for the time and type of stocks people purchase. Buy when a given stock is on the rise and frantically sell when it begins to tank. A trend, provided by TheBigPicture below:

Sentiment_cycles

This is where my puzzlement begins, if the goal of stock investing is to gain a degree of capital return then why is the general trend to invest when the price is high and sell at a loss which few winners providing few with earnings. However, shouldn’t the most opportune time to invest be when a stock is on the fall? Surplus of stocks equivocated with a lower price equates to a higher potential loss/stock but mitigates risk and presents an increased opportunity for a winner to arise.

Though with that said, the only thing entirely predictable about markets, is their unpredictability. 

 

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