Financial Markets Book Financial Markets For The Rest Of Us
An Easy Guide To Money, Bonds, Futures, Stocks, Options, And Mutual Funds
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by Robert Hashemian

Page 128

observed how one of my daughters walked in the other one's room playing with a filthy, ragged doll that had been ignored and tossed around for months. Suddenly this deserted doll became the center of a hot argument between the two kids. Decorum was all but forgotten as they prepared to battle over this prized treasure tooth and nail. In their minds, this worthless toy had suddenly been elevated to the highest value and they were willing to do anything to take ownership of it. An hour later, the poor doll, looking even more ragged and showing signs of battle scars, was ostracized to the corner of the room while the children's attention went elsewhere. They wouldn't touch it even if it had a fresh scoop of chocolate ice cream in its hands. So many times we have seen the same scenario played out in the adult world of the stock market, and I would be lying if I said I have not been caught up in it a few times myself. A stock of absolutely no recognition suddenly becomes the hottest issue to own and its price skyrockets for no apparent reason other than a simple rumor. And a week later, with its price back to its original value, it is headed for oblivion once again. Or maybe not. How many times do analysts expect a decline in the market only to be surprised by a rise, or vice versa?

I am not stating all this to scare you off from investing in the stock market. I am a big proponent of investing.My intentions are to ask you to develop a healthy respect for the stock (or for that matter any) market and not to be easily swayed by opinions that these days are a dime a dozen. Learn the facts (which you are by reading this), make your own educated judgments, and try to resist making emotional decisions in your investments.

There are two basic emotions that send some investors to the poor house: fear and greed. Fear of losing their money and greed to make more and more money. Surrendering to these emotions causes many investors to act at wrong times, meaning to buy when it's time to sell


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  • Book Chapters
    Table of Contents Copyright and Disclaimer Foreword Money
    Bonds Futures Stocks Options
    Mutual Funds Retirement Final Words Appendix A

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