InvestorQ : Is it true that it is difficult to try and get even with the markets?
Sadaf Khan made post

Is it true that it is difficult to try and get even with the markets?

Answer
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Anu Biswas answered.
2 years ago


One of the arguments in favour of long term investing is that you cannot reasonably predict the market movements in the short term. The big problem is that either we believe that we are right or we believe that the market is wrong. Remember, the market is what it is and as a trader it is your job to adjust your trading strategy to the vagaries of the market. The market, ultimately, represents the collective wisdom of millions of traders and investors and so it is rarely wrong. When you try to get even with the market, you are singularly fighting against the collective wisdom of the markets. More often than not, you are likely to find yourself on the wrong side. Secondly, as a trader you also benefit by staying on the same side of the momentum. By trading against the momentum, not only are you taking a huge risk but you are also reducing your probability of success in trading.