Question

A saying goes 'bulls make money, bears make money, pigs get slaughtered'

Why is this a irrational idea that can result in making less not more money?

Answer 1

The famous Wall Street saying " Bull makes money, bear makes money, pigs gets slaughtered".

Which means that when market's trend is upward it is called bullish when stock prices are high and people tend to invest more and more in market but unfortunately this period doesn't last forever as corrections take place in market, all those who are holding overvalued stocks will loose money.

Bearish market when the trend is down wards, the intuition of pessimism all over. People will short sell more securities, but who are doing it just by chance or copying others and not doing their research will also loose money.

Pigs get slaughtered means one who wants to make more money in the short period of time will overlook risks and suffer losses in market.

So the irrational idea is one will make more money in the short run irrespective of the market trend. To earn money in the market one needs to be patient invest diligently and do proper research and deploy different strategies, use hedging techniques and all of that is done rationally.

Irrational idea will lead you to making less money.