Why The Stock Market Isn't a Casino!
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One of the more cynical reasons investors give for avoiding the stock market is to liken it to a casino. "It's just a big gambling game," some say. "The whole thing is rigged." There may be just enough truth in those statements to convince a few people who haven't taken the time to study it further. The Casino - film - was created in 1972. Casino Empire happened in 2002. Often, however, paying careful attention to financial statements will disclose hidden problems.
Moreover, good companies don't have to engage in fraud-they're too busy making real profits. 2) The individual investor is sometimes the victim of unfair practices, but he or she also has some surprising advantages. No matter how many rules and regulations are passed, it will never be possible to entirely eliminate insider trading, dubious accounting, and other illegal practices that victimize the uninformed. The stock market has gone virtually nowhere for 10 years, they complain.
While the market occasionally dives and may even perform poorly for extended periods of time, the history of the markets tells a different story. My Uncle Joe lost a fortune in the market, they point out. Many people will find that hard to believe. Here's a simple conclusion If you've been avoiding the market because you believe it's a casino, think twice. Those who invest carefully over the course of many years are likely to end up as very happy campers...notice, we didn't say gamblers.
1) Yes, there's an element of gambling, but- Imagine a casino where the long-term odds are rigged in your favor instead of against you. If you adored this post and you would such as to obtain more information relating to atlantis online casino kindly go to our web page. Now you have a more reasonable approximation of the stock market. Imagine, too, that all the games are like black jack rather than slot machines, in that you can use what you know (you're an experienced player) and the current circumstances (you've been watching the cards) to improve your odds.
Of course, severe drops can happen in times of low interest rates as well. Look for red flags in the financial news, such as the beginning of the recent housing slump or the international credit crisis. Remember that the market goes up more than it goes down. Don't let fear and uncertainty keep you from participating. Even poor market timers make money if they buy good companies. Compare historical P/E ratios with current ratios to get some idea of what's excessive, but keep in mind that the market will support higher P/E ratios when interest rates are low.
1) Consider the P/E ratio of the market as a whole and of your stock in particular. Most of the time, you can ignore the market and just focus on buying good companies at reasonable prices. But when stock prices get too far ahead of earnings, there's usually a drop in store.
Moreover, good companies don't have to engage in fraud-they're too busy making real profits. 2) The individual investor is sometimes the victim of unfair practices, but he or she also has some surprising advantages. No matter how many rules and regulations are passed, it will never be possible to entirely eliminate insider trading, dubious accounting, and other illegal practices that victimize the uninformed. The stock market has gone virtually nowhere for 10 years, they complain.
While the market occasionally dives and may even perform poorly for extended periods of time, the history of the markets tells a different story. My Uncle Joe lost a fortune in the market, they point out. Many people will find that hard to believe. Here's a simple conclusion If you've been avoiding the market because you believe it's a casino, think twice. Those who invest carefully over the course of many years are likely to end up as very happy campers...notice, we didn't say gamblers.
1) Yes, there's an element of gambling, but- Imagine a casino where the long-term odds are rigged in your favor instead of against you. If you adored this post and you would such as to obtain more information relating to atlantis online casino kindly go to our web page. Now you have a more reasonable approximation of the stock market. Imagine, too, that all the games are like black jack rather than slot machines, in that you can use what you know (you're an experienced player) and the current circumstances (you've been watching the cards) to improve your odds.
Of course, severe drops can happen in times of low interest rates as well. Look for red flags in the financial news, such as the beginning of the recent housing slump or the international credit crisis. Remember that the market goes up more than it goes down. Don't let fear and uncertainty keep you from participating. Even poor market timers make money if they buy good companies. Compare historical P/E ratios with current ratios to get some idea of what's excessive, but keep in mind that the market will support higher P/E ratios when interest rates are low.
1) Consider the P/E ratio of the market as a whole and of your stock in particular. Most of the time, you can ignore the market and just focus on buying good companies at reasonable prices. But when stock prices get too far ahead of earnings, there's usually a drop in store.
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