Who is Right?

http://buzz.money.cnn.com/2012/08/23/stocks-funds-inflows-outflows/?iid=HP_RiverSince beginning of this year, retail investors have been pulling money out from the stock markets while the stock markets continue to charge ahead.The hedge fund managers are also holding a large chunk of cash though they are not in net short position. They are preparing to take advantage of market decline but their refusal to short stocks indicating the market can...

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How to Lose Money in the Stock Market

Instead of writing something positive like how to be a millionaire or how to be a successful investor I prefer to write about how to lose money in the stock market. After all, 99.9% of people are having IQ 150 and above, why write something that they are already good at -- smart and successful in the stock market. This post is not backed by research but by experiences that I heard throughout my life. I hope you can follow these simple tips if you want to lose money, shirt and underwear in the stock market. I will you pay you the difference if you...

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Reversion to Mean

Some stocks or commodities generated poor or good returns for good reasons. Poor fundamentals or stretched valuations but selling for a high price will produce worse results. Improving fundamentals or modest valuations will produce good returns. The European stock markets performed poorly is understandable. Shanghai Composite Index generated closed to 50% losses is getting more attractive by days. The average PE for A shares selling for 11...

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