theory | Stock Market Resource

The Dow Theory is certainly the most celebrated, complicated, and least-understood interpretation of market action, probably because neither Charles Dow, who founded the Dow Jones Company, nor any of his various disciples has ever defined the theory precisely.

In essence, the Dow theorists hold that there is a primary movement in the market at all times — a kind of basic tidal action.Then there is a secondary movement, which might be likened to waves.And finally, there are the ripples on the surface that represent the daily movements of the prices.The Dow theorists contend that it is possible to tell when either the primary or secondary direction changes by comparing the actions of the various averages, such as the Dow Jones Averages.

When they move in the same direction for a given period of time, either up or down, they are supposed to indicate a significant change in the direction of the market, which will hold good until the two averages “confirm” each other again in an opposite direction. This is what the “market experts” are talking about when the i.e. say “the rails confirmed the industrials” — or when they worry publicly about the failure of one to confirm the other.

Dow theorists contend that by their somewhat nebulous formula, they have been able to forecast every significant movement in the market for many years. Other analysts, looking at the same set of facts, dispute the Dow Theory’s record. They say it can only be made to look good when the forecasting has become history. Nevertheless, many financial editors continue to expound the Dow Theory and various Dow disciples appear in the advertising columns from time to time, offering a letter service, usually short-lived — to explain the market action in Dow terms.

Very often, the investors will encounter what appears to be a striking contradiction between the news and the market reaction to that new

There is one simple explanation for such paradoxes:
Let us assume that the stock market has “discounted” the news. The big traders — “the people supposedly in the know” — were certain that i.e. a special dividend was coming, because the X Company’s profits had been increasing spectacularly.They had already bought or sold in expectation of these developments, and when the actual news-breaks attracted public interest in the market, the professionals seized their opportunity:They sold when others bought or bought when everybody else was selling.

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Stock Market Game theory

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Stock market is highly volatile market. One can earn money with the stock market easily, that could be a better investment but there is equal chances to occur with the loss. Some time people meet with the losses higher than the profit occur. They got mad because they lost their valuable money in stock market.

Every one who enters in the stock market, his or her ultimate goal is only to earn more and more money. He can make all his or her efforts for making money with the stock market. He can live in front of the T.V. For the whole day because he want stock market updates. These updates that he or she finds from the T.V., Radio, News paper and many more such media can be helpful for them for the trading purpose.

Stock market is nothing but a platform where we can play with money. The theory for the stock market game is not very tough. Any one can play this game. The rule for the game is decided by exchange. One can enter with the money with his or her full hand and exit either with the bags that is full of money if he won or with the tears in his or her eyes when he or she loss.But he or she dose not left everything. At that time he or she has a lot of good or bad experience of stock market either he or she exit with the money or without the money, no matters. Than what the stock market is the exactly for, if money doesn’t matter. Here money matters but the the experience says that every loss get a experience for future.

Stock market is the money making platform with some stages these are come, watch, buy, wait, sell and exit. If you stuck a little bit time more in any of these stages, you suffer because every stage contains a specific time value for the profit making. Specific time value is not predefined for any of the stock. The person who is dealing with the stock is only one who is responsible for this specific value time either he or she is trading with one stock, stock in lots, trade in equity market or trade with derivatives or it may be the commodity for share trading. He or she can take help with the advisory firms that deals with share market but the basic thing for stock market game theory is your money only. The reward is also the money but it is the highest return on your investment that you can’t earn from any other legal way. And who can take risk easily that could be the best battle field without any battle even without any violence, we can say it is cool and calm some better but panic game where there is no space for any type of dispute the game theory says but peace of mind is rare. Here you can win with your luck and can loss by your luck. Research for the market is your intelligence. A lot of market research takes you nearer to your goal that is to get higher money on your investment in the stock market. It is not totally the mind game, it is the game of patience and and heuristics about the stock market. Pre stock market knowledge can help a lot and can give good fruits. This is the some basic of stock market game theory. Every one can play and win in the stock market game but the game theory says that the basic thing is knowledge about the stock market if one want success in stock market game.

Disha Sharma

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