Wise Up
The Stock Market Jungle (Part II)
We’re back for our jungle safari through the stock market!
As you dive into the stock market, you will find yourself coming across a number of animal names – each having a unique meaning with respect to the stock market, trade, or investing. Today, we’ll go over a list of some such animal names and try to explain what each of them means –
- 🐔 Chicken – Yes, this is a fear-based nomenclature. Chicken refers to those investors who are always fearful while trading in the stock market. These investors love nothing more than avoiding risky investments and are more likely to lean toward more conservative instruments of investing like simple savings accounts, bonds, and gold.
- 🐑 Sheep – Sheep are the investors with a herd mentality. They stick to one investment style and try very hard not to deviate from that style. Typically, the Sheep will be the last ones to adopt new investments based on what’s trending and are also the last ones to opt out of options that are on the downturn. Simply put – these investors feel safe doing whatever the majority of the investors in the market are doing.
- 🐶 Dog – Dogs aren’t people. Obviously, dogs aren’t people! But we mean, for the context of this article as well – dogs aren’t people. Instead, in the world of investing, a dog refers to a stock that has taken a beating owing to repeatedly poor performances in the marketplace. Interestingly, financial analysts will routinely check in on dog stocks, because these can sometimes be likely to see upturns in the future as well – often making them feasible low-cost investments with growth potential (in SOME cases!).
- 🦆 Duck – The ‘Lame-Duck’ refers to the investor who trades, but ends up incurring a huge loss. This could be because of an individual default on debts, the inability to cover trading losses or even bankruptcy. The term lame-duck can be traced back to the mid-1700s during the early years of commodity trading. But – long story short – you don’t want to be a lame-duck.
We realize that so far this stock market sounds more like a farm, and less like a jungle – but bear with us, we’ve used the word ‘jungle’ a bit loosely. These next three animals also can’t really be found in the jungle – but they sure have a place in the stock market.
5. 🦅 Hawk & 🕊️ Dove – Policymakers who make decisions based on different economic situations can be classified as hawks and doves. Hawks are typically looking to implement stringent and tough policies in an economy, whereas the doves want to take a softer approach and be more flexible in their policies. Both of these are crucial to the overall status and stability of financial policies in the country.
6. 🐋 Whale – The mammoths of the sea, and the stock market! Whale investors are those who are trading in such large volumes, that their trading practices can have a direct impact on the stock market itself. This could refer to a person or an entity like a business. Whale investors influence the market, so following the footsteps of such investors can mean big gains or losses, depending on how they end up affecting the market.
7. 🦈 Shark – A shark, when exposed to the smell of blood, becomes laser-focused on getting its prey! Similarly, a shark investor, when exposed to the prospect of making gains, becomes laser-focused on raking in monetary rewards. Shark investors enter the stock market with this singular goal, and exit the stock market as soon as the goal is achieved. These investors prefer not to get into complicated market processes and instead focus on quick and profitable trades.
And that brings us to the end of this wild(life) party! Tell us in the comments below – which stock market animal are you?
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