Sunday, November 03, 2013

Fear of missing out: Marketwatch article

Fear and greed are what tends to drive the markets. Fear of missing out is one of the more common forms. Kirk Spano at Marketwatch has an article about so-called panic buying (link), or the fear of missing out. Performance chasing is another word for it.

Those that only listen to those bragging about profits, might think that market timing is easy because 90% of the reports on the Internet and in person, seem to come from winners. Keep in mind, that the reportage comes from a self-selective group, where the losers tend to be silent. The saddest cases are those that lose everything and never want to speak about the markets again. You rarely hear about the losers on Internet brag boards.

As always, this kind of article is a red flag. However, by itself it is not actionable. A person can continue to watch for other signs and stay alert. It is a not a low risk time to be buying stocks. The bear visits all markets. Trying to time market tops tends to be a difficult, low probability game. Readers know that I tend to favor high probability trades.

No comments: