Investin bubbles that are good to recognize so you don’t lose

People sometimes behave completely when investing. They can succumb to euphoria and shop at the best prices. Or they start panicking and get lost when the investment bubble bursts. Investment analyst Michal Valentk explains how to recognize bubbles that warm investments.

The investment pinst asn profit and loss. One of the worst things for an investor is emotion. Print out rational considerations and they are most evident in times of investment fever and disasters. In the first case, investors are in euphoria, in the second in agony.

In recent years, we have witnessed a positive development in the capital markets, so there is a probability that euphoria will currently occur among investors. It comes to me with investment bubbles, their existence is realized by most people and after their collapse.

1.Rational bublin: find a distant hlupka

The rational bubble is based on the principle of find further fool. Investors in this case buy assets at high prices, which are very far from their value, or their intrinsic values. Clem investor (in this case speculator) is nothing more than a given asset to sell for you price two, no bubble bursts.

An example of the last msc jebitcoin. To determine the intrinsic value of this cryptocurrency is dark, but bitcoin is significantly strengthened. The people are aware of this, so buy me this. He thinks that the trend will continue and in the next few days, we will also sell bitcoin at your own price to the fool. The interest in this case is nothing more than that they can buy something that Dr. sells.

Of course, the principle of each investment is to buy cheap and sell expensively. But in this case it is a rational ignorance of the useful value of the asset and if I am the last of the last to buy the asset, after the bursting of the bubble mm in the hand of black Peter j.

2.Me: star pravidla u te neplat

Me is a bubble from pesvden. In this case, the people are unwavering that the current situation in the market (and assets) is different, not in the past. The rules, principles, teachings, and wisdom that prevailed in the past are buried today, and we are only waiting for light, a new era, as many.

A classic example was the real estate market in the USA in 2007. At that time, investors did not take into account the long-term demographic development as a driver of real estate demand in the long run. Sales of new homes in the United States in 2001 exceeded the maximum of the last 40 years and every year, and by 2007, the number of new homes increased, and even the demographic curve would not change significantly. Houses were not built and did not buy due to the satisfied needs of housing, but as an investment. It was only a difficult time when there was an excessive supply of bubble bursts.

3.Economic bubble: ve is in the best horseshoe

The economic bubble is linked to fundamental data and can complement me. The data are excellent, both at the macroeconomic level (GDP growth, low unemployment, utilization of production capacities at 100%, etc.) and at the microeconomic level (profits and sales of companies).

And first here is the mainness of this bubble. It seems to be in the best shape, so it is justifiable that asset prices are rising. Analysts predict a vibrant future on the basis of growth trends and investors are relieved, because experts care.

Very few people can connect that economic development is a dead end. We don’t have to go far for opt treasures. Real estate in the United States pushed the US financial sector into the stratosphere at the turn of the millennium. Banks made money not only from record mortgage lending, but also from investment banking. Their profits were inflatable for the first time, and many investors did not associate this fact. The real estate market suffered a short-term decline, but banks were massacred.

4.Informal bubble: pebrm nzor others

The information bubble can be considered as a separate type of bubble or as an accompanying element of the others mentioned. In this case, the investor can act on the basis of his own information and start to take the views and insights into the development of the market from others.

To illustrate, let’s look at the bottom of the stock market situation. Many investors claim that stocks are expensive, but see how everyone else buys stocks. So you wish all the people were to grind. That’s why investors lose their own opinion and start buying, even if they think otherwise.

Give trpliv

An experienced investor would be sure to put on the types of bubbles. However, these ones appear in the absolute veto of investment euphoria. If we know them, we should avoid their consequences. On the contrary, you can go to the investment, it will be patient and nehamin.