Thursday, December 7, 2017

The warnings of professional players

As an investor if you are interested in the financial markets, lately, as I`m sure, you keep on hearing about bubbles, and overvalued markets either from people who`s professions directly involves financial markets and hence they must be always fully aware of what's happening in the industry either from professional market players who`s jobs are also to make a living from the markets hence they too are, and must be, fully aware of what`s happening with the financial markets they follow. The reason why these guys started to send warnings, either from a technical point of view either from a fundamental point of view when analyzing the financial markets, and from what it seems to me at the current levels the warnings come from both point of views which makes them so much more worth of being taken in to consideration, is because of the abnormalities they observe in the recent (or maybe not so recent) behaviour of the markets. Every each one of these guys have their own tools that they use to asses the condition of the markets and lately probably many of these "tools" they use warns them about the fact that certain outliers are in play and that the current market conditions are under no circumstance normal. From my point of view an investor should take in to the consideration these warnings very seriously as while the markets usually do not react immediately and actually nobody can anticipate or predict what the markets will do, the professionals of this industry are already in full alert mode and their "game" is currently to ensure that whatever happens their capital will not suffer to much damage even if the markets continue to go up or the crash takes place the very next moment. They have already hedged their positions, reassessed the risks, and adjusted their exposure, a thing that actually might be responsible for the snow ball that is the current growth, and the snowball is still growing. Nevertheless the warnings are valid, the markets will do what they always do, sooner or later the bubble will break and the bigger the bubble the bigger the explosion. Most likely the question for an investor is what to do? Getting out might seems a bad idea when the market is growing like it never grow before - at least on certain instruments, take for example bitcoin. The safest answer to that is probably to take your profits and run until you run out of luck. Many have already done that, perhaps in doing so they are currently regretting however it is certain that they can be sure of the fact that the regret of missing bigger profits is fall smaller when compared to the regret of losing all the profits or for that matter losing more than profits. As I was saying, professionals have no risk, they are...hmmm listening Verdi - March Triumphal if I may say that :)).           

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