A WORD FOR THE FUTURE STOCK TRADERS

THINK IT IN ADVANCE BEFORE YOU PLAY THE GAME.

STOCKHACKER
Publish date: Tue, 23 Sep 2014, 01:07 PM
A personal opinion in stock trading

Hello my beautiful friends and readers,  

*Good to hear that, spiritual believe works. Indeed it do wonders to me and mean a lot to myself.
Reading is good, understanding the content is marvelous. Rather than keeping to oneself,  we share and give.

One day, I read this, and I wish to share among my friends. 

A Game.

You might have heard this before. If not, pay attention. It's a good one for me,  hope for you too.

Imagine I have a $100 bill for auction. The bidding starts at $1.

The rule of the auction. If you're the second highest bidder, you still have to pay what you bid. But you don't get the $100 dollar bill.

Of course I got some bids at $1, $2, $5. " Hey, why not, I got a chance to get $100 for $5!

The bids keep coming and by $51, I am happy, I'm going to a profit now.

Once they get to $90, they are less enthusiastic, but a reason to stay in.

Once they get to $99, the person offering $98 will think " uh, no, the other person is not backing down" and raises his bid to $100, so as not be the second lowest and lose the entire $98.

But now, the person offering $99, raises his bid to $101, better to lose $1, rather than $99, right? 

Soon, they're offering $110, $120, $130 and the game could go on forever. 

The problem is, we are not thinking through in advance. 

When the game starts, it's easy to think short term and say " Oh, it's a good deal" 

Then, when it's too late, you will slowly realize, " Oh, uh, what have I done?"

Maybe a lot of people get into a situation like this:

An entrepreneur borrows a lot of money to test his idea.

A homeowner who bought a house at the top end of their budget. 

Oops! , didn't think of that before starting to play it through huh?

Some games are clearly rigged against them, so the right choice is to not play that game at all. We should always ask, " How will this game ends."

It's worth the effort and a reminder to me too.


Invest wisely.~~

P/s: There are always long term implications in everything we are doing now. The moral is when you are in the game or endgame you should know whether or not it's a zero sum game you are playing. 
 

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4 people like this. Showing 2 of 2 comments

qychong

Clever game!

2014-09-23 13:59

Kevin Wong

Most often than not, those who trade, speculate short terming...on stocks - are playing a zero sum, rigged, I win-you lose, fools...game.
While it's often, those who invest for the long term in value & dividend stocks - are playing a win-win & prosper for all game.
Which game do you want to be participating in, a game which begin & end well for all or a game where only meant to prosper a few, by making all the rest poor? If you choose the latter, then don't cry foul, unfair, cheats...when you suffer losses.
Often you reap what you sow!

2014-09-23 16:48

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