Too Big to fail.. whether market is so high to avoid any new investment?

Too Big to fail… whether market is so high to avoid any new investment?

EVEN IF YOU AVOID, mutual fund (DII) will keep buying as the money inflow into mutual funds is high.

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Predicting a market top or low is not the way to invest. Its valuation of companies.

I dont see any company close to its value. So i wouldn’t invest new money. Will the valuation be attractive in a bear market. YES. Will the people think about investing in bear market NO.

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Point to note is about cause is the effect phenomena…

See
’A’… retailers r buying mutual funds, fund houses, diis r using that money to buy stocks…nav rise in mutual funds…
'B’
Retailers see d rise and either existing retailers continue buying mf or new join… This leads to ‘A’ again

In short fund manager is just buying even at unjustified valuation due to liquidity… He is not able to sell due to no redemption call and is just acting as custodian watch dog…

This will continue till greatest fool is found…

Keep going :slight_smile:

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And this cycle goes on, until the market crashes and that day all are like are stock market is gamble blah blah blah.

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@VIPULK Ohh… u have explained in simple terms what “reflexivity” is all about.

:+1: George soros also explains elsewhere what happens after “greatest” fool is found and there are no more fools. Sudden panic created by mere thought that there is shortage of fools in the world :sweat_smile:

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@TraderVenk … true , this is very important for buying if speculation is too high … in my opinion also should refrain from buying ridiculous prices …

But for some point in time… This journey has just begun… Article about Mutual Fund