Why Do People Buy At A Top?

I didn't think about the survivor bias in indexes, but I think their quotes are still quite representative of the behaviour of all stocks. See for example NASDAQ100 and NASDAQ Composite (for many indexes around the world you find both the selection and the total).

I took the DJIA as a representative for all stocks because we have a lot of data.

I don't think we could have a negative return,but I don't know.
Actually, we should think about what happens to an index and to a real investor portfolio when a firm fails (for example,General Motors).

As I said,what is not representative at all is the dividend yield.

 

http://www.multpl.com/s-p-500-dividend-yield/

Says median yield has been over 4%pa

 

Is it the net after taxes that goes into investors pockets?

 

people buy high is driven by greed.

most high price is already factored in, so it is non-sense to chase HIGH.

when NQ dropped to 10, and 7.5, I feelt it is cheap.

I made another killing from another side.

I am buying put on SPY this morning, I do notr expect another SPIKE after FOMC's minutes.

and buy NBG calls even some 2015/2016, it is cheap. people thinks backwards, they just see how bad it is, think it contraniraly, you will "wow, it is worth more lot"

I just waif forthose morons who buy myshares whenit hits 10~12.5


common sense, thehigh price already factored in before this announcement

if sudden spike, it is another good chance to buy more PUTs.

only fools buy sweet crude at $145+


that is why fading news always work

 

:eek:

 

Dunno, lets say it's not and the tax rate is 25%. Then the yield becomes 3%

 

fade the news, fade the government is a pretty productive strategy.

when the best news there, you will see the market drops

when the worst news there, you will see the market rallies

since before those news, market already factor in those things.

market always look far beyond current moment, not biaed facts/dead history!

 

Interesting . what are you basing that? What type of trader are you?

I am a scalper and the high is what interest me, I am neither a greedy nor a “non-sense4” trader
At least I don’t think so lol

but if you talk to trade long swing etc..... then I might agree not to trade the top.....

the other day I posted this;

(Today with OXBT at the top +/-$2 there was another 30 ticks to make)

IMO isn't how one trade but how many $$$$$ came out at the end

 

SPY 177. The head fake.

 

That was one a heck of a head-fake -- maybe a headbutt in the face of bulls. In 15 minutes it went down by 1.25 --- it looks like a vertical chute in the chart.