GXY 0.00% $5.28 galaxy resources limited

I think there are a few issues at play here, and these apply not...

  1. 8,720 Posts.
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    I think there are a few issues at play here, and these apply not only to the GXY thread but to many stock threads on HC, for as long as I've been a member (just under 10 years now):

    Traders short term perspective vs Investors long term perspective.

    Investors generally have a long term investment horizon and naturally during that time stock prices will fluctuate. Despite the long term investment horizon some investors seem to obsess about daily price fluctuations, when in reality the important thing is what will the price be doing in the timeframe they are investing for (I assume > 1 year).

    Contrast investors to traders who are interested in short term price fluctuations and buying at the bottom of the current cycle and selling at the top. Obviously if the price is in a short term down trend there is no reason for traders not to discuss that because they are trying to determine how low it will go and what are the signals saying price has found a safe low to buy again.

    Obviously many investors don't like people talking about the stock they've invested in going down (the pragmatic ones do realise that that's a natural feature of the stock market cycle so are not bothered by traders' short term perspective) - this type of investor tends to get defensive when they see traders discussing how low they think the price will go (because naturally the investors just want the price to go up while they own the stock).

    This defensiveness presents itself in the form of angst against traders who they believe are saying negative things about "their company" or that the traders are "downramping" to talk holders into selling so the traders can buy at cheaper prices. When in reality traders are simply commenting about their views of where they think the share price is going short term.

    The above situation is exacerbated by 2 factors:

    The 1st is that the (good) traders often use language which is straight to the point (eg. this stock is in a downtrend, I think it might get to 30c (when the price is at 50c) and the language is not sensitive to the perspective of investors who are seeing the value of the investment decrease during a downtrend, or they make little effort to phrase their comments in a way that is sensitive to the holders' perspective.

    The 2nd of course is that there is a % of traders (who I call bad traders) who actually do downramp and are deliberately provocative with the language and seem equally interested in inciting angst amongst holders as with trading the highs & lows - all traders sholdn't be tarred with this same brush (just as not all investors are the same).

    The final factor is how active posters are on a stock. For a stock like GXY which has a pretty active contributorship (based on number of posts per day), when there is not much news to talk about, talk turns to speculation, or it simply goes around in circles covering the same ground time after time, or turns to discussing daily or even intra day price movements (even by investors who I would have though would have a long term perspective, but imo seem to obsess to their own detriment about daily price movements as if a 1c move down in SP today means the end of the world for the company).

    In short, the issue is there are different demographics sharing the same thread and often they are talking cross-purposes so what one group is saying is taken the wrong way by the other.

    As I say I have been on HC for almost 10 years and I have not seen this change on stock threads one bit. I don't think it will ever change. Again not all threads are the same, some stock threads show a better sense of decorum than others, but my observation is that the correlation there can be linked to what % of contributors how well the stock has performed historically and what % of posters are stale holders that are in the red on their investment.

    The above are just my observations of the dynamics at play.

    Cheers, Sharks.
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