The Hindu Business Line : As stress increases…

Afraid of how the markets will open on Monday? You are not alone if you said, ‘yes’; the maximum number of people are feeling threatened all the time, says Tony Plummer in ‘Forecasting Financial Markets’, fifth edition ( www.vivagroupindia.com ). Reason: Financial markets are moving continuously, and are subject to an infinite variety of influences, with an ever-present danger of causing money losses, he explains.

Therefore, despite promises of infinite wealth for the successful trader, the real experience is different. “For the vast majority of people, the actual or potential emergence of losses is likely to generate negative emotions and inappropriate defensive strategies.”

As stress increases, the attitude to dealing becomes less and less rational, observes Plummer. For relief from anxiety, the trader may identify himself with other traders with similar views, which is how a herd instinct is triggered. “Our avoidance compulsions therefore drive us into the welcoming arms of the crowd.”

A book that can alert you to the varied pulls impacting traders, and also equip you with a counter-strategy.

Try GEM

Looking for an investment strategy? Try GEM that Vincent Catalano describes in ‘Sectors & Styles’ ( www.landmarkonthenet.com). GEM stands for government, economy, and markets, the three components of business life. The interplay among these segments is how the world works, says the author. “For example, to ignore the impact of the loss of political power is to igno re the impact to economic policies of the party whose power is at risk.” Though you don’t need to be an expert in all the three areas at all times, what Catalano asks for is ‘a fairly good level of knowledge’.

The book devotes a section to ‘the twenty-first-century investment tools’, where the author discusses the power of the PC and the Net, as also of ETF (exchange traded fund). “The technological and financial innovations of recent decades have enabled more investors to do what previously were reserved for the members of the portfolio manager’s club,” assures the author. He hastens to add, however, that technology is not a substitute for human skill and capability.

For a detailed study.
Brainteasers

Suppose you found a coin with the year 369 BC written on it, What can you say about that? There are 81 coins. One of them is fake and lighter than a real coin. How can you identify the fake coin using a balance scale within 4 weighings? There are two shares: the first is cheaper than the second. The first is increasing in price at the rate of 5 paise a day, and the second is decreasing at 10 paise a day. One day the prices become the same. What was the difference between t he prices 2 days before they became the same?

These are just a few of the posers in ‘Money Puzzles’ by Sergiy Klymchuk ( www.crosswordbookstores.com ).

Racy read!
Get a grip on your finances

Make money work for you. This is one of the twelve instructions that Andrea Molloy gives in ‘Redesign Your Life’ ( www.macmillanindia.com ). “Take control and get a grip on your finances once and for all,” she exhorts. “Learning how to manage your money will reduce your stress levels, enabling you to focus on other life priorities.” Molloy frets that most people have some kind of limiting belief about money. Such as, “simply burying your head in the sand, hoping that if you don’t face your bills they will sort themselves out”!

Fortunately, your limiting beliefs are generally a reflection of your perceptions, and they can be changed if you are willing, says the author. “This may come as a surprise, but money can buy you happiness, not in the literal sense, but by matching your financial plans with your priorities and values.” And, as Molloy counsels, financial goals, plans and budgets can be practical tools that will take you ‘step by step closer to your dreams’.

Good guidance.
http://BookPeek.blogspot.com

More Stories on : Books | Book Value

Article E-Mail :: Comment :: Syndication :: Printer Friendly Page