Wednesday, October 13, 2010

Why it is easy to lose hard-earned money in the Market?

For most retail investors, have you ever question why it is so easy to lose our hard-earned money in the Market?

First reason: Emotion
Because it is your hard-earned money, so the emotion attached to the buy/sell transactions.
Fear comes when market turn south. Greed comes when index or share price leap and jump up.

Second reason: You are playing the game with the Pro.
Once your order is executed, the rest is beyond your control. The Pro have lots of tools at their disposal. They have better source of information. So, who stands a better chance to win?

Share market is a zero-sum game - If most people lose money, who wins?

Am I suggesting not to invest in the Market? No, I merely encourage investor to do more homework and put in more effort before put your hard-earned money down, else it is very close to gambling (in the name of investing).