As a small investor, I obviously watch the stock market mostly to look for bargains but also to look for trends. I also watch some of the forums to see what other investors are saying. There is a lot of ramping because sentiment does influence buying and selling but not to an extent that we can influence it. I do suspect that traders in the City of London are more positive and tend to buy on days when the sun is shining! I don’t base my dealing on the weather forecast, though.
Some investments take a long time to come good and are much riskier than the FTSE 100 companies. We can limit risk by diversifying and limiting our exposure quantitatively. These investments often lose money, at least on paper in the short-term, but can give a good return in the long-term.
Many investors make an investment in a small company and hope they make it big. I have high hopes that Solo Oil will make it big with its shares in oil discoveries both in Tanzania and in the UK.
There have been many events since 2008 that have spooked the financial markets but Brexit and Donald Trump winning the US presidential election must be the most nerve-jangling for investors. Clinton had plans that were seen as negative for the pharmaceutical industry but Trump also seems to be a threat to Obamacare that could also have a negative effect, as well.
Since the credit crunch of 2008 investors have demanded higher returns on the perceived risks associated with the stock market. Perceptions of investment risk changed in 2008 and made investors more risk averse and Brexit reinforced their fears of another meltdown. We nervously wait for article 50 to be triggered which is another storm warning that could devastate the market once again.