Commentary lesson 1 and 2

The nature of a Stock is much like most thing in our universe.

A force of nature is something which will happen and there is nothing one can do but attempt to be on the right side of the movement.

A wild creature( like stock) really doesn't care if you exist until you grab hold of it (put money in) . Then and only then, do we truly begin to learn the nature of the thing. It has a way of holding your attention. We also begain to learn some new things about ourselves ...

Stock assumes a Nature just like all other living, breathing things.

A Stock is the monietization of Human Nature. You can witness the whole spectrum of human emotion...the two most extreme are desire and fear...Some times, Stock acts like a mighty Bison in a winter blizzard out on the open range ,completely oblivious to to the freezing wind and snow. Other times it's like a flock of a zillion pigeons ,spooked by every moving thing...

Most times , I think of tracking a particular species of stock much like I would hunt a Mountain Lion or Deer. To observe a potential Quarry , one must first decide what type of prey you want to track.

.. make a list

...where dose it range
....When dose it spawn
....what weather conditions are best
... is it heavily hunted
....is the population plentiful
...is it an ant or an elephant and what kind
....Are there maps of the terrain
....once you find your prey , what is your goal
....dose it migrate up and down the mountain or dose it stay in a territory
...what is the mode of capture and /or containment
..when do you want to make your catch
...in the valley
....going up the mountain
...on top
...or going back down
...how long are you to hold
....when are you going to release
....how much will be invested
.....how much return is expected
....what is the risk vs reward
....an I mentally and physically prepared for the journey

....sounds like a lot of stuff right?


I know what a Mountain Lion is and I also know it can be dangerous. Somehow, I have always known I should be afraid of this animal. Learning all I can allows me to Manage this fear to a very healthy respect for the Lion's potential.

Well if this is all bewildering to you, let's just go to the grocery store ....every one of these questions apply ....even if you are after a Box of water.

Oh...I see ...you would rather go fishing....what kind of fish...boat?pole?bate?
etc....Check the weather, almanac..fishing report news....season...limit..local fisherman tails
...are you gonna sell them , eat them or catch and release (that's called practice)

Now, let's use some common sense here. There are thousands of companies.

Where do you start?

Well first let's start with the point of view . There are at least 12 great companies in any category you pick. so.. walk through the house , office, mall, factory, restaurant or parking lot and pick two items in which you have an interest.
It is best to identify completely different market sectors ....make sure it is something you enjoy, like and something you could see your self devoting your life to..

WHAT? .....You say you want to invest your money into something you don't care about?
People who own and run companies devote a large portion of their life , time, education and money becoming an informed expert in their industry....Look.. Once you know your industry, you will feel free to move your money from one company to the next depending on the market conditions.

You will learn and know when the various herds of bison are in the valleys or moving up the mountains...you do know, they... uh.....won't stay in the mountains all season?


The herd will go down to the valley and stay there a while then migrate to the foothills. They will deal with a few range fires, get spooked by wolves and sometimes run back toward the valley. But, their nature eventually forces them to migrate back to the mountain...every single stock dose exactly the same thing to one degree or another..

There is one more thing you'll need to know.

....Money is made by someone in every market direction...this is important .

Let's say you buy a herd of buffalo.

..now your money will be made when the herd gets to the top of the mountain ...your going to sell them to someone who makes their money taking the herd back down to the valley.

so when do you want to buy the herd?
1 . going down?
2. in the valley
3. in the foot hills
4. at the top?
5. is it spring or winter?

.....this is called identifying the trend and getting on the right side of Nature (the trade)

....oh ya ...Did I mention there will be a helicopter waiting to take you down to a new valley of your choice so you can buy another herd to take up a other mountain....could be water Buffalo in China on this trip....next season it will be Buffalo in Wyoming....it doesn't matter. There is always a new herd ready to go up the mountain somewhere in the world.

you also discovered something about the nature of this type of creature....
1. it feeds it self
2. it reproduces by it self
3 .it protects it self
4. it knows how to survive weather , wolves and bad news ,
5. when the herd starts to move up the mountain.. IT WILL GO! up the mountain and it knows where it is going and how to get there.

....so what did you do?
....your job was to stay with the herd until you sell it to that guy on top!...

.we're not done
.
...you're going to meet some people alone the way up....some one's gonna tell you the herd is ugly, noisy and smelly... the next guy will notice the herd has stopped "it's just standing around eating grass and getting fat!.....then you run into some careless campers who start a grass fire and spooks the heard ......with all the smoke the news paper guy finds you and says "how will you ever get to the top at this rate ? Oh buy the way, did you hear about the buffalo trader who died last week? Aren't you concerned there won't be a market for your heard once you get to the top?"

Now your beginning to think, this Buffalo trip might be a bad idea..

The next morning a industry Analysis flys in and downgrades your heard because they don't think the winter coat growth is progressing well and mutters something about possible Stress on the Herd ......oh Boy!....you can feel the money pouring out of you pockets.....but you hang on....

Now what!...The herd is head'n the wrong way! It's heading for the river...


You turn on the radio...the Government Expert says "we had storms in the mountains... the rivers will be really really hiiiigh."...oh my God you think, the herd is going to drown!

Along the trail there's a sign posted on a tree. It says .....Old Mule Skinner in a shack by the falls....has gold for Buffalo .....you might talk him into tak'n that suicidal herd off your hands before they end up in the river.....it won't be as much as you paid but if they all drown ....then what will you have.?

"That river really looks scary", says the old Mule Skinner . "I can take em off yer hands now if yer like . I'll gve ya gold.....or if'n you don't want to sell ... I've seed this herd come through these parts fer the past 20 years. Fer a fee I ken tell the leed Bul to wate t'll the river git's down.....but that dosen't gar'ntee he'll list'n..."

Now it's late and your tired . What are you gona do now?
When you wake the next morning, the whole heard is gone! You run to the edge of the water and see the herd grazing in the sunshine on the other side!
As you cross the river, Mule Skinner hollers ," watch out! The wolves are in the big trees!"

The herd .....they knew exactly how to cross that river.....

So....what did all these other people know that you didn't? Well I'll tell ya .....Those people knew the chances were very good you didn't take time to learn the nature of the herd and they either tried to exploit your natural fear or inadvertently encouraged your natural insecurities.....

Market Trader Tao Says..... "A Trader goes about doing nothing when the boundaries cannot be seen.....thousands will say with out ceasing ...but the trader owns the results . "


NeboXian