Animals in stock market
Stock Market - Understanding the Bulls, Bears and other animals.
Any discussion on stock market doesn’t go without mentioning bulls and bears. It may sound like stock market is probably like a jungle. These terms, however, originate from different stories.
Long ago, "bear skin jobbers" were known for selling bear skins that they did not own; i.e., the bears had not yet been caught. This was the original source of the term "bear".
This term eventually was used to describe short sellers, speculators who sold shares that they did not own, bought after a price drop, and then delivered the shares.
Because bull and bear baiting were once popular sports, "bulls" was understood as the opposite of "bears." I.e., the bulls were those people who bought in the expectation that a stock price would rise, not
fall.
The Bulls -
A bull market is when everything in the economy is great, people have jobs, gross domestic product (GDP) is growing, and stocks are rising. Things look fantastic! Picking stocks during a bull market is
easier because everything is going up. Bull markets cannot last forever though, and they can lead to dangerous situations if stocks become overvalued. If a person is optimistic and believes that stocks will
go up, he or she is called a "bull" and is said to have a "bullish outlook".
The Bears -
A bear market is when the economy is bad, recession is looming and stock prices are falling. Bear markets make it tough for investors to pick profitable stocks. A solution to make money when stocks are
falling is using a technique called short selling. Another strategy is to wait on the sidelines until you feel that the bear market is nearing its end, only starting to buy in anticipation of a bull market. If a
person is pessimistic, believing that stocks are going to drop, he or she is called a "bear" and said to have a "bearish outlook".
Chickens -
Chickens are afraid to lose anything. Their fear overrides their need to make profits and so they turn only to money-market securities or get out of the markets entirely. While it’s true that you should
never invest in something over which you lose sleep, you are also guaranteed never to see any return if you avoid the market completely and never take any risk,
Pigs -
Pigs are high-risk investors looking for the one big score in a short period of time. Pigs buy on hot tips and invest in companies without doing their due diligence. They get impatient, greedy, and emotional
about their investments, and they are drawn to high-risk securities without putting in the proper time or money to learn about these investment vehicles. Professional traders love the pigs because
it’s often from their losses that the bulls and bears reap their profits.
Very Important Note: "Bulls make money, bears make money, but pigs just get slaughtered!"
Table of contents: Stock Market tutorial
1. Stocks: An introduction.
2. What are stocks ?
3. Types of stocks.
4. How stocks trade
5. How stock prices change ?
6. How to purchase stocks ?
7. How to read a stock table/quote.
8. Animals in stock market
9. Stock Market Tutorial: Summary.
