dusty lightbulb

There has been a dearth of photo opportunities lately, and this will likely persist into the next two months. Then again, I frittered almost the entire day away when I should have been dutifully studying.

Lately, I’ve joined the likes of liquidity investors, chasing equity. If I was present when our solar system was coalescing, the likes of the various financial innovations in existence today would be unimaginable. What I’ve picked up as a greenhorn is this; the right price is subjective. It may sound overly simplistic, but you’ll be surprised at how counter-parties are willing to buy a share from you at the price you had thought was the right one. It was right for them, and this forms the basis of market forces; without it the financial market will cease to function. Ultimately the price will converge upon a fair value, and the volume will more or less stagnate until new information is discounted in the price. Also, trading equity is a zero-sum game (minus the likes of options and transaction costs), and many of us cannot be possibly be monitoring the index with vigilance. This is where the ‘liquidity’ in ‘investors’ comes in; we often incur costs against people (hedge funds. insider trading etc) with better information and trading advantages (technological). There is also the danger of trading in contra, especially if the market turns bearish. 1 cent south on 100 lots represents a $1000 loss excluding transaction costs, enough to trigger cardiac arrests especially if you don’t have the cash in the first place.

Something that couldn’t possibly be chased rationally though, are technological gadgets. I mean you can, if not we wouldn’t see the huge margins and the companies wouldn’t be in existence. As we speak, Apple probably has the Iphone 6 to 10 in its vault (sarcasm intended but hey, their products impress). Successful companies like these, Canon included, hardly release game changers in successive cycles. They have the know-hows on pricing and product marketing. A recognizable trend with electronics would be this: release a stripped down version, and put it back in the next product cycle. Canon did a fantastic job with the S95, and I’m guessing its successor will probably come with a better video (autofocus, zoom). Maybe a wider angle (24mm) and that’s about it. It will be enough to capture the market that was not sold by its predecessor. I may be wrong come August, but hey, look at Windows Professional, Enterprise, Home, Student etc…intrinsically the same thing marketed to different users. The users that require/want the extra features will eventually cough up the sum required.

*Author is an amateur writer and will not be responsible for any financial losses stemming from cited article.


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