Understand the psychology of the stock market

By CEO Espen Grønstad

Technical analysis and behavioural finance use investor psychology to predict future stock market developments. Investor psychology is based on the fact that humans to a large extent are driven by basic needs, in which pain and pleasure are important reasons for the choices we make. Even though companies and technologies have changed, we are influenced by the pain of losing and the pleasure of winning. Consequently many of our choices are largely based on emotions and not rational assessments.

Fundamental analysis faces similar problems. Large, reputable stock brokers arrive at different fundamental conclusions, even though they have access to the same information and underlying assumptions. This shows that the subjective human factor in making the assessment is more important than the actual circumstances. We need to take this into account when making our investment decisions.

Studying the stock price allows us to identify patterns and trends that represent the greed, fear and insecurities experienced by investors. Sustained movements when large market sentiments are moving are hard to stop, and they give us, as chart analysts, a big advantage. Through solid research and the development of algorithms in behavioural finance, Investtech has shown excess return compared to market index. Read more about our results on our Research pages or try our analyses for free for 14 days.

 

h_PivotPoints

 

 

Kirjoittaja



Espen Grønstad
Partner & Senior Advisor - Investtech

While technology changes, the expectations and psychology of the
investors are the same. That is why chart analysis is so important!

Articles:

Ostosignaali nousevassa trendissä - analyysi

67 % success for buy signals

Hyviä mahdollisuuksia aktiivisijoittamiselle

 

Technical analysis:

Understand the psychology of the stock market

My favourite indicator is Trend

My favourite indicator is REC

"Investtech analysoi markkinoiden psykologiaa ja antaa konkreettisia kaupankäyntisuosituksia päivittäin."

Espen Grønstad
Partner & Senior Advisor - Investtech
 


Investtech ei takaa analyysien tarkkuutta tai kattavuutta. Kaikkien analyysien tuottamien neuvojen ja signaalien käyttäminen on täysin käyttäjän vastuulla. Investtech ei vastaa mistään tappioista, jotka saattavat syntyä Investtechin analyysien käytön seurauksena. Mahdollisten eturistiriitojen yksityiskohdat mainitaan aina sijoitusneuvon yhteydessä. Lisätietoja Investtechin analyyseistä löytyy täältä disclaimer.


Investtech ei takaa analyysien tarkkuutta tai kattavuutta. Kaikkien analyysien tuottamien neuvojen ja signaalien käyttäminen on täysin käyttäjän vastuulla. Investtech ei vastaa mistään tappioista, jotka saattavat syntyä Investtechin analyysien käytön seurauksena. Mahdollisten eturistiriitojen yksityiskohdat mainitaan aina sijoitusneuvon yhteydessä. Lisätietoja Investtechin analyyseistä löytyy täältä disclaimer.

Titlex

OK
+

Cookie consent

We use cookies to give you a better user experience. If you continue to use the website, you accept this. For further details click here.

Our use of cookies

When you use our website, we store a cookie on your device. The cookie is used to recognize your device so that your settings work when you use our websites. The information that is stored is completely anonymised. Cookies are automatically deleted after a certain time.

Necessary cookies

Investtech uses cookies to ensure basic functions such as page navigation and language selection. Without such cookies, the website does not function as it should. You cannot therefore make a reservation against these. If you still want to disable such cookies you can do so in your browser settings. In the Cookies section add this website to the list of sites which are not allowed to save cookies on your device.

Cookies from Google

We use services from Google Analytics and Google AdWords. These register cookies on your device when you visit our website. Google registers your IP address in order to keep statistics on user activity on the website. The IP address is anonymised, so that we have no opportunity to link the activities to a specific person. We use these statistics to be able to offer more interesting content on the website and to constantly improve ourselves. Google AdWords collects data so that our advertising on other websites gives better results. We cannot trace the data of individuals.

Allow cookies from Google