Today March 23, 2009 is a good day for Indian markets. Market is up by 457 points. There are no strong reasons for why the market is up? I was following couple of market analysts and all that they predicted at 9.30 am is markets “might” be up and it will have resistance in the range of 200 points, one analyst predicted that it will rise and then flatten out and other predicted that there might not be any major changes. In some time during the noon, the analyst realized that the markets are going up and they changed their sentences as, markets are doing well and it will go up further north. This was a good sign to investors.
I was confused as to how can the analyst change their views within a span of 3 hours or so. Then I realized that, they are also predicting and they can change and people are not so very keen to remember the analyst’s views. They want a solution right then and then they don’t think much about it. I have seen many a times the so called investors call up the so called analyst and ask his expert opinion as to whether to hold the stock, buy the stock or sell the stock and the analyst gives his expert opinion. I have always wondered when they can predict so much and give their views on stocks; they could easily make millions by using them rather than giving it out to the public.
I am sure not many analysts will have their own portfolio, they might advice other investors as to how the money should be invested but when it comes to their own money they will invest in low risk financial instrument. I am not against the analysts or investors. I just want to bring out the point that markets can’t be predicted. It is just random. The market behavior is just like our investors, not sure of anything. As an example, I want to quote today’s incident. Today no major policies were rolled out in India or nothing investor friendly happened but today the markets were up by 457 points. the market Asian markets were performing better. They were all up and I guess that is one of the reason for Indian market to be up but the question is, if other markets do well, will Indian market also be better?
I have noticed many a times that the Japanese market would be climbing up and ours would be crashing down. There were no significant reasons for the same. Analysts say that investors are gaining confidence or losing confidence and all that; but I am not sure how come the investors gain confidence in just a day or two or lose the confidence in a day or two. Isn’t it surprising? Can you gain confidence in a day?
I can’t gain or lose confidence so soon and I assume most of us will be like that. The truth is that markets are just random, no rules apply to it. you can’t predict how the market will be and I am sure if you could have predicted you won’t be reading this blog and instead minting money in the stock market.