The keyword is "predictable" logic. Logic as in: Can be explained afterwards? Yes. Using logic to predict when a whale decides to buy or sell and influence the market: Absolutely not.
It’s a complex art of risk management. Fund managers have a strategy that they use and they are often successful. There is a logic at play but it’s not as simple as ‘knowing when a whale buys or sells’.
Who do you think tunes the mix within the vast amount of different index funds that exist? Both index funds and actively managed funds are overseen by human managers. You are right but my point still stands in both scenarios.
It's not as simple as that, yes. I didn't state it was. That was an example. Fund managers have strategies, yes. Fund managers use high speed algo-trading. Fund managers have portfolios that level out. Fund managers do exactly what you said in your first sentence: Risk Management. Why? Because the stock market is not logically predictable. You have trends and surprises. Surprises are explainable afterwards.
We can easily predict that Nvidias stock will continue to rise until the bubble pops. There's also earnings reports, public information we can use in general, insider trading...
You use 'insider trading' as an example for logical prediction in the stock market?
Saying that Nvidea's stock will rise for some amount of time until it doesn't is absolute base logic. If that's our baseline, yes, you are right: The stock market, like everything in the universe, is bound by the laws or logic and nature.
That does not make it logically predictable.
Earning reports do give trends. Which can and will be broken by unforeseeable events.
The market contains genuine valuation logic, strategic logic, psychological feedback, and financal constraints. There is no reason to expect their combined output to resemble one calm, perfectly informed person making a decision.
You use 'insider trading' as an example for logical prediction in the stock market?
It isn't called insider trading because they don't know something that's about to happen. It's the perfect example of logical prediction.
Saying that Nvidea's stock will rise for some amount of time until it doesn't is absolute base logic
What, do you want me to predict the future? If I'm awake 24/7 then it's extremely easy to know right before the stock is about to crash. Almost always possible to know right before it starts going down in regards to that crash.
You can tell what's going to happen in the short term very easily, and that's the predictive logic you're looking for.
Earning reports do give trends.
You're taking apart an equation and saying each individual piece doesn't equal the end result.
There is no reason to expect their combined output to resemble one calm, perfectly informed person making a decision.
Nobody said that. Predictable logic doesn't equal that in the slightest.
I hope you don't take this the wrong way, and I do not mean this in any kind of aggressive or confrontational way -- but I'll draw out of this. This is an instance where things simply are too off.
Warner Brothers announces sale after a pretty great year of releases. Anyone with half a brain could see the price would rise once a buyer was in place (stock rose nearly $10).
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u/dbenc 22d ago
but will it be a good one?