Should you buy or sell stocks?

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Series "Trading Philosophy"…1

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Information with photos on the Internet is interesting; there was a public restroom graffiti that said, "Do not smoke in the toilet. I’ll poop in the smoking area" … (laugh)

A person who entered a cigarette-stinking toilet and was upset about breaking the rules was highlighted as having “a point,” and now another post says, “Do not graffiti in the toilet; I’ll poop in your notebook” … It’s a battle that makes you laugh more honestly than parliamentary scandals.

The general image is that stocks are to be bought.

Even as a deeply considered conclusion by professionals, there is a way of thinking that stocks are to be bought.

Stocks are a share of a company.

When investors buy stocks,

the company uses that capital effectively to pursue profits,

and distributes a portion of the profits to the people who bought the stocks (shareholders).

A company is a group that exists to earn profits.

If the company grows, the price of the bought stocks also rises.

Therefore,

　it is reasonable to think that stocks are something to be bought

in other words.

There is some truth to it.

In Japan, there is a common view that Japanese stocks do not offer as much benefit from long-term holding as the American market—i.e., “buy-and-hold”—but there are cases where the number of shares increased due to stock splits, and asset value swelled due to subsequent price rises, or simple stock price growth from company growth, which supports the idea that stocks are something to be bought.

In contrast, there is a philosophy that stocks are to be sold.

What exactly is the thinking…?

I will introduce it in the next email.