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I just want to explain what I think might have happened to CSE. As you know CSE is mainly retail driven, and most of the retailers including me joined the stock market during 2008-2010, during the bull/bubble phase where nearly all the stocks were doubling in value every six months, and credit by retailers was used to the maximium. Mind you, even on those days I did stick to the T+3 rule as a principle. But I know many friends of mine who used their credit to the max, and their brokers were also happy as the credit generated an hefty tax for them, as well as most of the new investors were short term and day traders without much knowledge of the market (But I also need to add that most of the stock brokers also don't have any knowledge of the market).
There was a lot of speculation running the market, and many stocks had prices that really should be 5 years into the future.Many people also got credit facilities from their brokers even more than the 50%. it was all good when the market was going up.
But the the SEC came into its senses and brought in the T+5 rule, and took out the credit facilities of brokers. Then the brokers also got angry, and also wanted to show the SEC a lesson (loss of income from credit-exorbitant rates at 25-30%). Force selling started, and when the market goes down, and u have a lot on credit, your losses are amplified. I did not get caught in the credit crunch, but could not avoid going into red as most of the good stocks also crashed, when the market fell as a whole. The forced registering of finance companies (unbelievable price rises after listing) and the multiple IPO's (Mostly loss making, due to private placements which helped the rich become richer) also made the matter worse. There was not enough free money in the CSE to go around.
My loss while investing fairly safely is around 30% of portfolio, while I have friends who have lost nearly 70% due to the credit crunch and force selling cycles.
All of the money we all put was hard earned money. I heard that many retirees also started to invest in stock market as well. Therefore after loosing a lot of money, even when the SEC decided to relax the rule of T+5, and also made credit facility available to brokers, now the retailer is at loss, and doesn't have money and also the confidence he had before. But the stock brokers won, cos now they can again charge exorbitant amounts from their clients who go on credit. But most retailers wont fall in to the same hole again (I hope) or are afraid. So since there are not enough new investors, the market has become stagnant.
these days, most people think that the only way to earn a buck, is to go after speculated shares, as can be observed in the past few weeks. People jump in the wagon of a hitherto unknown, but suddenly high flying illiquid stock, and again lose a chunk when the stock crashes down. And a lot of financial reports these days are leaked out, as we can see, the sudden surges in prices before some financials of companies (But sometimes the financials actually are worse, and the spike in the price is when the Rich people with inside info exit that stock!!!).
Compounding this issue is the jitteriness of our investors, despite the good performances from reputable companies in the cse. Most are making good profits. But still most people chase the speculations, because now they want to recover their losses in one or 2 days!!!. Also One word from channel 4 or hillary or ban ki moon, the market dips by 5%. Also the current world stock markets are also shaky.
So now when you wonder what has happened to the CSE, you have to understand that we all contributed to it, and also for us to get out of this hole, its high time to start investing instead of gambling. Of course the HNWI, Some shady brokers, manipulators with inside news, and the greed inside ourselves will be against this
Hope what I said above made some sense to you guys
Cya, happy investing!!!
There was a lot of speculation running the market, and many stocks had prices that really should be 5 years into the future.Many people also got credit facilities from their brokers even more than the 50%. it was all good when the market was going up.
But the the SEC came into its senses and brought in the T+5 rule, and took out the credit facilities of brokers. Then the brokers also got angry, and also wanted to show the SEC a lesson (loss of income from credit-exorbitant rates at 25-30%). Force selling started, and when the market goes down, and u have a lot on credit, your losses are amplified. I did not get caught in the credit crunch, but could not avoid going into red as most of the good stocks also crashed, when the market fell as a whole. The forced registering of finance companies (unbelievable price rises after listing) and the multiple IPO's (Mostly loss making, due to private placements which helped the rich become richer) also made the matter worse. There was not enough free money in the CSE to go around.
My loss while investing fairly safely is around 30% of portfolio, while I have friends who have lost nearly 70% due to the credit crunch and force selling cycles.
All of the money we all put was hard earned money. I heard that many retirees also started to invest in stock market as well. Therefore after loosing a lot of money, even when the SEC decided to relax the rule of T+5, and also made credit facility available to brokers, now the retailer is at loss, and doesn't have money and also the confidence he had before. But the stock brokers won, cos now they can again charge exorbitant amounts from their clients who go on credit. But most retailers wont fall in to the same hole again (I hope) or are afraid. So since there are not enough new investors, the market has become stagnant.
these days, most people think that the only way to earn a buck, is to go after speculated shares, as can be observed in the past few weeks. People jump in the wagon of a hitherto unknown, but suddenly high flying illiquid stock, and again lose a chunk when the stock crashes down. And a lot of financial reports these days are leaked out, as we can see, the sudden surges in prices before some financials of companies (But sometimes the financials actually are worse, and the spike in the price is when the Rich people with inside info exit that stock!!!).
Compounding this issue is the jitteriness of our investors, despite the good performances from reputable companies in the cse. Most are making good profits. But still most people chase the speculations, because now they want to recover their losses in one or 2 days!!!. Also One word from channel 4 or hillary or ban ki moon, the market dips by 5%. Also the current world stock markets are also shaky.
So now when you wonder what has happened to the CSE, you have to understand that we all contributed to it, and also for us to get out of this hole, its high time to start investing instead of gambling. Of course the HNWI, Some shady brokers, manipulators with inside news, and the greed inside ourselves will be against this
Hope what I said above made some sense to you guys
Cya, happy investing!!!
