Too Big to Fail…

I am sure, any financial news paper readers have must read above lingo many a times. This term was mainly used for 2008 Financial Crisis, and later on it was used for large Pvt Ltd companies, whose book size is so huge that, it is too difficult for them to fail. But, you know the history, there is nothing Too Big, to Fail,,, yes anyone can fail in this market.

You must be thinking, what is going in my mind, and what next. I come to the main point-

In last couple of days I came across some smart stock scanners (I am little skeptical to call them Technical Analyst), who keep on bombarding about their performance and blah blah. I thought let’s give them a chance and try to gauge whether they really outperformed the market or not. You know what is the result, they manage to give good returns*.

Now you must be thinking what this (*) mark is all about, if you have noticed. Undoubtedly their performance is better, but their performance is not their client’s performance. Little confused? Let me clarify, what this smart stock scanners do. During an intraday session, roughly they give 15-20 probably more, because I am not their client. Out of this given calls, some will do better; some will be marginal and some stop losses. Now, if you check their so called performance sheet than in an intraday their performance could be around 60-65% or more, and I appreciate that because even though with this performance anyone can make good amount of money with trading.  But immediately after that, one thought came in my mind; if suppose I would have been their client than could I able to replicate same performance in my balance sheet? Immediate answer is absolutely no, because I am 100% sure that I am not going to take all the suggested trade, just because of many reasons like, limited capital, lack of conviction, if initial few trades got hit than lack of morale and many other factors.

Now, in above case service provider has a valid argument to make that, I have performed better than others, and for that they have the proof, but what about my balance sheet? In worse case I may be in a loss.

I hope now you are in line with me, Too Big to fail applies to this smart people. Because they keep you giving the calls and finally they bunched so much together and beautifully manage their performance sheets.

Dear readers, while taking any services just make sure whether you can able to digest it or not. If your answer is No, than their service is of no use to you. Big No.

And dear stock scanner, you must understand that, even if your client is a pure intraday trader and even though his livelihood depends on trading, even though he seats with two trading screen, then also in all the case he cannot take more than 5-7 calls a day, and just leave the idea of layman, who just trust you.

I think it is time to make a revolutionary change. Service provider has to evaluate performance based on their client’s performance. I know what I am saying, it is extremely difficult, but it should be the goal.

Always aim for the Moon, even if you miss, you’ll land among the stars.”                                       ― W. Clement Stone.

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