recency effect - a case study, page-51

Winter. You picked a 2% downswing on this stock today based on technical analysis not fundemantals. You can go crazy over fundementals and i always find it interesting when people mix the 2 in their trading.

I pay almost zero attention as to what influenced previous pricing actions. All i am concerned with is what happened and then being able to extrapolate forward to what is likely to happen.

Most lunatics can make a profit in the stock market by buying anything in the top 200 and waiting. It's just a matter of how long.

I think the real skill is in making a decision on the direction of the market and putting you hard earns on the line.

I also like watching the late night market wraps. They are all experts in hindsight. Free entertainment and closely akin to the comedy hour. Put them in the same basket as economists.

I'm an ardent believe in setting your trading rules and sticking to them. I have read a lot in these forums that indicates this is not commonplace with many decisions based on gut feel and long term hold and hope strategies.

Traders will tell you this is costing you money through a little understood concept of economic cost of capital.

Educate yourself, there are plenty of books and the ASX has heaps of material as well. Find a good broker (most are used car salesmen so get references)who will provide you with the information you need on trading instruments.

I use a couple of different broking firms and i take advise on what to buy from none of them. I seek the information and make my own decision. They aren't going to give you a refund if their suggestion tanks. Your money, your decision.

Good luck in circus.