The temperament of a investor plays a very important role in his success or failure. Whether he is optimistic or pessimistic influences what he does which in effect decides the result he gets from the market. Let's take the BJP or Modi victory in UP state elections and look at how different investors would react to it.
The Optimists's View
The optimist would see this as a great tailwind for the market which will take it to new highs. He would further say that this actually seals the BJP victory in 2019 and is a long term positive event for several years to come. It would make passage or implementation of major reforms like GST, attack on black money, bad loan cleanup, digitization very easy for the ruling party and keep good news flowing into the market and hence he would suggest that people should invest blindly in this market.
The Pessimist's View
The pessimist would see this as an expected event that the market has already factored in. Any run up in the market according to him would be a good opportunity to book profits in the market. He would argue that elections and other political events have only short term impact on the market and going forward market would focus on results, monsoon, FED rate hike, EU elections, geopolitics, and the continuing trend of outflow from EM's to DM's
The Practical Optimists's View
A practical optimist would say that look market can do whatever it wants to do. It may go up or it may have factored in the UP victory and will face resistance and profit booking at higher levels or it may be range bound reacting to various global triggers... but it's going to be definitely better than what could have happened had BJP lost the UP elections. No doubt about that! Now that's a Practical Optimists's View that cannot go wrong can it ? better days ahead for sure !
Who am I ? I try to be the practical optimist .. always .. who are you ?
The Optimists's View
The optimist would see this as a great tailwind for the market which will take it to new highs. He would further say that this actually seals the BJP victory in 2019 and is a long term positive event for several years to come. It would make passage or implementation of major reforms like GST, attack on black money, bad loan cleanup, digitization very easy for the ruling party and keep good news flowing into the market and hence he would suggest that people should invest blindly in this market.
The Pessimist's View
The pessimist would see this as an expected event that the market has already factored in. Any run up in the market according to him would be a good opportunity to book profits in the market. He would argue that elections and other political events have only short term impact on the market and going forward market would focus on results, monsoon, FED rate hike, EU elections, geopolitics, and the continuing trend of outflow from EM's to DM's
The Practical Optimists's View
A practical optimist would say that look market can do whatever it wants to do. It may go up or it may have factored in the UP victory and will face resistance and profit booking at higher levels or it may be range bound reacting to various global triggers... but it's going to be definitely better than what could have happened had BJP lost the UP elections. No doubt about that! Now that's a Practical Optimists's View that cannot go wrong can it ? better days ahead for sure !
Who am I ? I try to be the practical optimist .. always .. who are you ?
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