The market is not a zero sum game. It is worse than that, as rightly pointed out by Edler:
"Markets are like pumps that suck money out of the pockets of the poorly informed majority and pump it into the pockets of a savvy minority. People who service those pumps, such as brokers, vendors, regulators, and even janitors who sweep exchange floors, are paid from the stream of money flowing through the markets. Since markets take money from the majority, pay help, and give what’s left to the savvy minority, the majority, by definition, must lose. You can be sure that whatever the majority of traders does, believes, and says, is not worth doing, believing, and saying. You have to stand apart from the crowd in order to succeed. Smart traders look for situations where a large majority does something one way, while a small, moneyed minority goes the opposite way." - Alexander Elder
The market has a huge overhead in order to support the trading structure. The money they need is obtained from the various traders through various fees.
This web log was initially created for people who trade Singapore Stocks over "weekends". It has now evolved into real trading logs and analysis of market and stock situations using technical analysis. This becomes a record of my trading and lessons learned from trading. For more trading lessons please visit: Good Investing Lessons or Good Investing Lessons (Old)
Wednesday, August 18, 2010
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- ES Sei
- I'd like to share my experiences and knowledge about healthy and happy living as well as mid-life crisis. 不以物喜,不以己悲。
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