Page 25 - Intelligent Investing (3)

What makes the stock price change?

The Psychology of Money

The main 2 reasons the stock market is constantly changing is because people

shift between greed & fear

Greed creates scarcity & raises the price to unstable highs that don’t last

Fear creates massive sell offs and price drops

Hence someone always wants what they don’t have and is looking to buy and

someone who has doesn’t value their shares anymore and is wanting to sell

The market will always be in a constant flux and it is up to the investor to learn the

patterns to position him/herself to be in a profitable situation