mashala signed, page-92

I am still pondering these ideas about the "smart money" moving the markets. I do agree that this is a big part of the game (and thanks for sharing yesterday Funky, that was a great contribution by the way) but there are just so many factors that affect markets that I think it could be over simplifying it to suggest that the professionals can fleece the mums and dads every time.

There are over 3,000 funds and instos in Australia alone (let alone overseas interests) vying for about 2,000 stocks on the ASX. The reality is MOST of the money on these stocks is the "smart money" if we define it by being the professionals (I wouldn't necessarily agree with the definition). If that was purely the case then the professionals are trying to fleece each other.

The markets at the end of the day move for two reasons - the fundamentals of the stock (which can be more or less ambiguous depending on the story) and demand and supply.

People buy and sell for all sorts of reasons (short, long term as an example) and they can change their view very quickly. For every buyer there must be a seller so in some ways you could say that they disagree with each other on where the stock is going to go. This is an interesting paradox in itself.

With what is happening with CCC this week you could argue that the people who are selling are happy with their 10% profit and the people who are buying are happy with their long term "investment". One persons trash is another's treasure as they say. They both have different agendas.

I have found in my experience that the biggest thing that drives spec stocks is news. If some news event came out today (even a report like D&D for example) with a strong buy recommendation it could drive this price up now. I would even suggest that if everyone on this forum turned sour on CCC now it would drop the price very quickly. In the short term that is.

I am trying to use all of these trading tips and tools but on the other hand know that it is far more complicated than simply reading charts. You really have to know the business you are in and treat it like an owner (even if just for a short time) if you are going to ride the fluctuations.

Fundamentals will always win through in the end.