{"id":193,"date":"2020-01-27T09:19:40","date_gmt":"2020-01-27T09:19:40","guid":{"rendered":"https:\/\/www.invest19.com\/blog\/?p=193"},"modified":"2020-01-28T04:54:09","modified_gmt":"2020-01-28T04:54:09","slug":"how-to-manage-fear-greed-in-the-stock-market","status":"publish","type":"post","link":"https:\/\/www.invest19.com\/blog\/how-to-manage-fear-greed-in-the-stock-market\/","title":{"rendered":"How to Manage Fear & Greed in the Stock Market?"},"content":{"rendered":"
<\/div>\n

Fear and greed as a word is\nsomething that has been associated with us humans since primitive times. If you\nwere to trace the very beginnings of human origin, you\u2019ll see that these traits\nhave been ingrained within us since those early times. These traits still guide\nus to this day on how we assess the situation and analyze our next step. And\nwhen it comes to the stock market, it\u2019s a no-brainer in seeing these pop up\naround in every conversation. <\/p>\n\n\n\n

The stock market is a breeding\nground for wealth and economy and most of it is driven by these two traits. We\ncan talk about the fundamentals, the strategy and all those goofy words but if\nyou look deep within, the stock market is first and foremost driven by these\ntwo emotional traits; fear and greed. That\u2019s what we\u2019re here looking at today.\nThe way how fear and greed have staked a claim in the stock market and how to\nmanage it. Read along. <\/p>\n\n\n\n

What is ‘Fear’ and how does it reflect on the stock market?\u00a0 <\/strong><\/h2>\n\n\n\n

Fear is the instinct that we\nsense when we recognize any threats. It is present in each of us and we tend to\nfeel the same whenever we are in any danger. This very feel is also experienced\nby a stock investor whenever he\u2019s into the market. Any impending danger on the\nposition of a person\u2019s investment or trade will entice fear in a person. Fear\nis often a common theme when the stock market is on the bearish side and any\ninterested investor tends to make his decisions based on the aspect of fear. If\nnot managed well, fear may land you pretty bad deals which may hamper your\ninvestment portfolio and your value. <\/p>\n\n\n\n

For say you\u2019re one of those who\ndeal in short term trades so as to realize quick profits.  During this, any change in the market\nposition of the stocks will, in turn, make you nervous and fearful of the\nfuture conclusion. That may result in you walking out of the trade sooner than\nexpected and may miss out on the profits later on.  <\/p>\n\n\n\n

What is ‘Greed’ and how does it reflect on the stock market?<\/strong><\/h2>\n\n\n\n

Greed is a different instinct to fear and is about the manifestation to win more. It is about wanting more of wealth and power. When it comes to the stock market, the wealth aspect of the greed suits perfectly. People have an inherent trait to seek more earnings and capital in the stock market. It is what lands many of the investors into a pothole of loss if not managed properly. <\/p>\n\n\n\n

For say an investor wants to take advantage of the\nbullish market and intends to buy the shares hoping that the market will continue\nto move along in the upward curve. It\u2019s not new to see greed surface time and\nagain in the stock market as it has been evident throughout history in the form\nof different market crashes. You can take the dot-com bubble or the 2008\ncrisis. Primarily greed was one of the major factors that lead to that certain\npoint before the market tipped over. <\/p>\n\n\n\n

How to manage fear and greed in the stock\nmarket? <\/strong><\/h2>\n\n\n\n

Although as human beings we are always driven by our\nprimal instinct of fear and greed, there is enough evidence that we can control\nit and manage it according to our desires and needs. You just need to\nstreamline it according to your plans and you\u2019d be on the good side. We here\nlook at the few steps to help manage the fear and greed in the market. <\/p>\n\n\n\n