Greece Crises : What Investors can really learn from it!
(Article by CA Rajiv D Khatlawala , Author "How to profit from Technical Analysis" Publ Visionbooks New Delhi.)
Since the deficit worries of Greece came to be known a few months back, a lot of action has taken place in the world specifically the financial world.
Most of the anxiety of the financial world and those connected with it, directly or indirectly, has been over the hidden problems of the Euro zone, mainly the PIIGS countries (Portugal, Ireland, Italy, Greece and Spain). It seems now that the Dubai crisis at the end of the previous calendar year was indeed the tip of the iceberg.
While the Eurozone has declared a near-$1 trillion package for its weak countries, their 16-nation currency - the Euro- has been on the receiving end for some time. It touched a 52-week low recently at 1.22 to a dollar as investors remained skeptical of the effectiveness of the package.
What can retail Investors learn from the current crises? Well actually a lot.
During the course of my various practical workshops on trading and technical analysis, I have enumerated few learning points for investors.
1. A few years back, we may have thought that only companies and individuals could go bankrupt. We would have laughed off a situation of a country going bankrupt or unable to pay off its debts. But over the past few years, things have changed dramatically. As investors, we need to be ever-prepared for the unknown.
2. The current crises in Greece may actually be the continuation of the sub-prime crises which started in 2008 and pushed the world in a recession. But at the core, it is the rampant use of financial derivatives that has actually led to the world-wide crises- be it sub-prime or even Greece.
3. This means that todays investor needs to actually keep track of not only the local markets and companies, but also of the happenings in the world financial markets. Thus, expanding and up grading of real life practical investment knowledge and knowhow is becoming increasingly important (at Investogyan, that is precisely what we help investors do)
4. The world has become highly dynamic and fragile, especially since the sub-prime crises. In such a scenario, taking a very long term investment view will actually increase, rather than reduce, investment risk.
5. With concerns over Greece and other countries, especially Spain and Portugal and with China showing signs high inflation and a possibility of a property bubble, financial markets the world over are likely to remain far from stable. Investors may want to become cautious, till the time there are visible signs of stability.
A Dynamic financial world suggests that we as investors too must become increasingly dynamic, lest we should be 'out of this fast changing' market!
CA Rajiv D Khatlawala
Managing Director
ValueTrade Academy Pvt Ltd.
(Article by CA Rajiv D Khatlawala , Author "How to profit from Technical Analysis" Publ Visionbooks New Delhi.)
Since the deficit worries of Greece came to be known a few months back, a lot of action has taken place in the world specifically the financial world.
Most of the anxiety of the financial world and those connected with it, directly or indirectly, has been over the hidden problems of the Euro zone, mainly the PIIGS countries (Portugal, Ireland, Italy, Greece and Spain). It seems now that the Dubai crisis at the end of the previous calendar year was indeed the tip of the iceberg.
While the Eurozone has declared a near-$1 trillion package for its weak countries, their 16-nation currency - the Euro- has been on the receiving end for some time. It touched a 52-week low recently at 1.22 to a dollar as investors remained skeptical of the effectiveness of the package.
What can retail Investors learn from the current crises? Well actually a lot.
During the course of my various practical workshops on trading and technical analysis, I have enumerated few learning points for investors.
1. A few years back, we may have thought that only companies and individuals could go bankrupt. We would have laughed off a situation of a country going bankrupt or unable to pay off its debts. But over the past few years, things have changed dramatically. As investors, we need to be ever-prepared for the unknown.
2. The current crises in Greece may actually be the continuation of the sub-prime crises which started in 2008 and pushed the world in a recession. But at the core, it is the rampant use of financial derivatives that has actually led to the world-wide crises- be it sub-prime or even Greece.
3. This means that todays investor needs to actually keep track of not only the local markets and companies, but also of the happenings in the world financial markets. Thus, expanding and up grading of real life practical investment knowledge and knowhow is becoming increasingly important (at Investogyan, that is precisely what we help investors do)
4. The world has become highly dynamic and fragile, especially since the sub-prime crises. In such a scenario, taking a very long term investment view will actually increase, rather than reduce, investment risk.
5. With concerns over Greece and other countries, especially Spain and Portugal and with China showing signs high inflation and a possibility of a property bubble, financial markets the world over are likely to remain far from stable. Investors may want to become cautious, till the time there are visible signs of stability.
A Dynamic financial world suggests that we as investors too must become increasingly dynamic, lest we should be 'out of this fast changing' market!
CA Rajiv D Khatlawala
Managing Director
ValueTrade Academy Pvt Ltd.
