Some thoughts on Investing

Most of us as retail investors go through this process, to be a "pro" we spend all our time either perfecting our Technical Analysis skills (reading of chart patterns as people believe they can predict these movements based on past results) or Fundamental Analysis (reading of financial reports and being able to see the potential strength/weakness or growth/decline).

Some spend their whole life thinking that Financial Analyst are god-send and follow their advice religiously.

Some gets sucked into the rumors that were spread and jump in without making their own judgement.

Some buy and do not even know what they are doing (i recently heard a story where a person bought a single lot of a stock and was so proud that she owned a stock, but didnt even factor in brokerage fee, and a host of other things)

And we all think we are pros in our own ways doing these things

BUT here's the big question:

Do CEO of companies look at fundamental or technical analysis or go around listening to rumors just to run heir company? Its a good question because if they do, then all the more we should improve on those skills. However, I believe they do not look into those when running their company, but rather think of ways to grow their share price/profits/revenue/etc..

So, this leaves us with the dilemma, if they do not do what the retail investors do, why then are we doing those things? Are we looking at the wrong thing?

And just a last thought on listening to rumors/analyzing big investor movements when we make investing decisions. Many times we read reports of this or that big investor selling their share and we think that we should follow suit.

However, here's the thought: There are many reasons for selling, but only one reason for buying (and that is for the price to go up). The big investor could have sold due to

- re-balancing of portfolio
- have cash for other opportunities
- to purchase a home?
- for unforseen things in live
- to bring family on a super duper expensive holiday

But when we buy, we are only hoping for 1 thing, and that is the price will hopefully go up.