The price of a stock reflects the current valuation of a company based on its anticipated future performance. If the future looks uncertain, the current price is likely to fall; if it appears promising, it will rise. In other words, the company’s outlook on the future is mirrored in the current stock price. Investing in stocks essentially means buying and selling future values while trading at present prices. However, the reason I can’t buy the stock now is that I’m afraid its price will drop in the future. Conversely, if I cannot sell the stock when the price decreases, I struggle to do so because the loss caused by the expectation that the stock might increase, or by the missed timing for the sale, is too significant; this can overwhelm me with fear. Thus, stock prices are most readily influenced by the weight of ‘fear rather than desire.’ Even though the current stock price reflects future value, it often happens that this future value is not trusted. When we say that time is money,...
One of the most important essentials of business is cognitive dissonance resolution. When researching who watches the Ford Motor Company commercials the most, the results are not potential customers but purchased customers. They want to confirm that their decisions were right or to receive continuous support after their purchases. Because we can never go back to the past, getting confirmation and support from someone makes us easy and comfortable beyond our regrets. So the company's strategy should focus on repurchasing the existing customers, not the new ones. In many business cases, businessmen should avoid assumptions or predictions. We shouldn't run a business depending on our thoughts only. - Joseph's "just my thoughts