Читать книгу Millard on Channel Analysis - Brian Millard - Страница 5

There has always been a difference of opinion between those investors who believe that the best policy is to buy a share and then virtually forget it and those investors who believe that better profits can be made by constant forays in and out of the market. Market professionals obviously belong to the latter category, since they appear to spend their whole day engaged in buying and selling operations. During the privatisations of British Telecom, British Gas, the water and electricity companies, etc., many amateur investors came to the conclusion that the best profit was the quick profit that could be made by selling the shares within a few days of issue, and therefore they took the same view as the professionals. However, if we look at the vast majority of investors in the privatisation issues, we find that they have no clear objective. They firmly believe that the share price will rise consistently over the foreseeable future, and have no inclination to sell unless sudden demands for capital are made on them. In other words, for most of these investors, their selling action will be dictated by personal circumstances and not the behaviour of the share price itself.

This view of buying shares and then holding on to them for long periods of time has much to commend it: it makes no demands on the investor in terms of having to manage the various shares that go to make up the investor’s portfolio, and it has resulted in good profits for most of the quality shares over the last 15 years or so. Looking at this statement more closely will lead to the conclusion that this buy and hold policy makes no demands on the investor simply because good profits have been made in most shares. If shares had been much more mixed in their long-term performance then it would have been necessary for investors to have taken a much more active stance. The fallacy in most investors’ reasoning is therefore that share prices will inexorably rise in the future if a long-term, say 10- or I5-year view, is taken. This long-term view can even accommodate drastic crashes in the market such as occurred in October 1987. On this long-term view, most falls in the market can be accepted merely as blips in the steady upwards progress, the October crash being just a slightly larger blip than has been the norm since 1929. We shall see later in the discussion on cycles in the market that the rise we have seen over the last 15 years cannot continue forever, and that once the very long-term cycles start to reach their peaks, then the long-term rise will turn into a long-term fall.