Up! Up! and Away! but for how long?
October 3rd 2006 16:40
We always pretend that we understand the market but in fact we actually don't because one's belief does not represent the beliefs of the majortiy of the market participants who dictate the market's future direction, subject to economic and financial information digestion. Yet, the rationale goes on that given the state of market sensitive conditions, it therefore becomes logical to extrapolate the future direction of the market because it is logical to be so. For example, it is logical for the market to turn north if economic conditions are set for the better and as such the market will reflect and incorporate the information through valuation dictated by the market participants. And so the theme of market information efficiency sets in.
The market on Tuesday had a good run after an initial setback with the ASX S&P 200 benchmark index gained 5.5 points higher at 5484.3. Analysts believe the surge was a result of bargain hunting after 20 weeks of sluggish performance by the market. The belief went further by suggesting better performance by the market for time to come.
Yet it was just a couple of weeks ago, analysts were painting a gloomy picture of the market due to a likely downturn of the US economy and possible southward heading resource prices. Are the analysts fitting and changing thier future descriptions of the market based on the minute current conditions? and if so, how are investors going to digest the information and dictate the market correctly? Are analysts market soothsayers? and finally, is the market efficient regardless of what the experts say? The answers are best by searching for the academic journals and of couse, always expect the unexpected.
Finally on the portfolio watch and like the market, Portfolio 1.5 - EW had another day of runaway success with value higher at 13.59% from yesterday's 13.08%. Paper profit is standing at $4,795 after first round of transactions,
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Start Your Alternative Diversification Today
The market on Tuesday had a good run after an initial setback with the ASX S&P 200 benchmark index gained 5.5 points higher at 5484.3. Analysts believe the surge was a result of bargain hunting after 20 weeks of sluggish performance by the market. The belief went further by suggesting better performance by the market for time to come.
Yet it was just a couple of weeks ago, analysts were painting a gloomy picture of the market due to a likely downturn of the US economy and possible southward heading resource prices. Are the analysts fitting and changing thier future descriptions of the market based on the minute current conditions? and if so, how are investors going to digest the information and dictate the market correctly? Are analysts market soothsayers? and finally, is the market efficient regardless of what the experts say? The answers are best by searching for the academic journals and of couse, always expect the unexpected.
Finally on the portfolio watch and like the market, Portfolio 1.5 - EW had another day of runaway success with value higher at 13.59% from yesterday's 13.08%. Paper profit is standing at $4,795 after first round of transactions,
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Start Your Alternative Diversification Today
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