Investment and Speculation (3)

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Serial Publication “Trading Philosophy”…18

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When approaching a festival stall at the temple fair, a helping child was begging a woman who looked like the proprietor to say, “I want to eat too.” She replied, “No! You might upset your stomach….”

I can hear you~

Last time, I introduced the trading rules of a securities company employee who is prohibited from speculative trading. You might think this has nothing to do with individual investors, but as an essential link between us and the market, the source of investment-related information, you cannot ignore it.

Now, for example, if you are constrained to “hold for at least six months in the cash market,” you cannot sell for six months even in the event of an unforeseen circumstance.

Even if you incur an unexpected injury while on duty, you are told to keep working without stopping the bleeding.

If you realize you are on the wrong-train in the opposite direction, does this mean you should ride for a while?

Furthermore, some securities companies prohibit stock trading in full even for relatives.

The larger the institution, the stricter the rules seem to be.

I understand the aim is to prevent financial professionals from making mistakes (not touching clients’ money), but I can’t accept it because it feels like a ramen shop that won’t let its employees eat ramen.

Securities salespeople are professionals.

It doesn’t mean that “everyone is good at the market,” but as professionals they connect us investors with the market. If they are bound by irrational rules, we must pay attention to how we interpret the information they disseminate.

There are market terms like “units” and “positions,” but many salespeople in the field use them to mean “the open position in margin trading.”

As an investor, even a conservative cash purchase carries risk in cash, a proactive sense of a “position.” But for securities firms, since cash purchases can be left unattended (deferred), while margin trading can lead to trouble, the sales logic often takes precedence, so cash purchases may not be called a “position.”

A situation is expressed through “words.”

“Words” become “actions,” and repeating them turns them into “habits.”

How do “investment” and “speculation” differ—since there are explanations that say “the method of investment is speculative,” it’s not so simple, but rather than simply accepting existing definitions, I would like to have time to think as a player.