If The Stock Market Were A Night Club…
Filed under: Analogy, Investing, Trading, Weekend Review
Value investors would be the guys that show up at the barren, run down club, when nobody is there. Everyone stopped going there months ago. They end up buying whatever drinks are on special, and pray for a good looking girl that might happen to be there by mistake and hope no one else has seen her there yet. They stick around and just hope that eventually the management will put some work into the place and people will start going there again.
Momentum traders would be the guys that go to the hottest club in town and get there right as the party is starting. They pay the $50 dollar cover, the $12 dollar domestics and make the biggest scene possible. They party it up hard and after a careful selection, the girl in which they see the most potential– they go for. They stick around until they see a few people start to leave and then after some careful calculations the momo’s leave because they wouldn’t be caught dead at a party that’s not kickin’.
Shorters take a different view of things. They go to the club and proceed to sit in the corner, get drunk and hope a fight breaks out. Possibly thrill seekers, maybe just pessimists - no one really knows for sure. They go for the more attractive girls in hopes that by the end of the night she’ll lower her standards and leave with them. Rarely successful, they usually just wait around for fights.
Scalpers are some of the sketchiest of the bunch. They start club hopping around 1:15 AM, so they never have to pay cover. They quickly jump from club to club hoping to do this often enough that one of these times they’ll catch a drunk girl on her way out and they won’t have to buy any drinks. They typically will sneak in and stand by the dance floor and pretend they’ve been there the whole time. ‘Small victories add up’ is their motto–Psh.
Long term investors are the guys that get to the club early–you know, eating dinner there– around six, seven o’clock. They’ve seen the best and the worst. They think there’s no possible way to time whether or not there’s going to be an awesome party there, so they just stick around regardless. They find a girl at the beginning of the night and hang with her, dancing and chatting all night. They’re genuinely nice to her and make an effort to show her their long term appeal. Little do they know that bars are not the best places to find these kinds of investments. (Haha..)
Short term traders are the guys that show up whenever and do whatever. Typically thought to be the rock stars of the bunch, they talk to and dance with as many females as possible in as little time as possible–just trying to drunkenly make out as many times possible in one night. Sometimes they’re successful and sometimes they don’t really get anywhere. Long term investors hate them because it looks like they’re getting all the girls from their large and publicly viewed profits. But in the end, they usually just end up with an oral ‘Banco Santander, S.A.’ (STD: 12.40 +1.64%).
The NASDAQ (kind of a sweet club name, actually?) would be a club where all the tech nerds hung out. It would have sweet LCD screens and the ’servers’ would bring drinks to you practically the second you ordered it. Almost…electronically? You might say? They all arranged to meet up there via e-mail, and then Google mapped the directions to get there. Definite usage of watch calculators to accurately divide the tab occurred.
Stock Brokers are the seemingly hot servers and bartenders that come over to you and try to convince you to buy an essentially alcohol-free shot from their tray full of neon glowing plastic test tubes for $14 bucks a pop. When you refuse, they then offer a body shot and/or pretend to be interested in you and what you have to say until like an idiot you buy a $14 dollar liquid ounce of fruit juice & Watermelon Pucker.
…and the list could go on and on–but honestly, I think that’s about enough. No one has probably read down this far anyway–We’re back to more serious stuff including the Trading Challenge tomorrow.



January 6th, 2008 at 2:24 pm
Funny, insightful look at the market. But… is there no such thing as female traders? Need to find someone with a female’s perspective to write the companion blog entry, since I’m curious. But yeah, you’ll catch me at the NASDAQ 4 lyfe. Ha ha, this was a good one man. Keep writin’.
January 6th, 2008 at 5:30 pm
Woohoo! I’m a rock star! I’ve always wanted to be one. Shame I’m not single anymore.
January 10th, 2008 at 9:19 pm
I’m going to have to disagree with your description of the “Value Investor”, you had it all right up to this point…
“They end up buying whatever drinks are on special, and pray for a good looking girl that might happen to be there by mistake and hope no one else has seen her there yet. They stick around and just hope that eventually the management will put some work into the place and people will start going there again.”
These guys pick up every hand-bill and flyer, scour every entertainment section of every newspaper they can get their hands on looking for the best drink specials. They would be visiting every club in sight “researching” the best places to hang out, waiting for the right sign to jump in and be the first one to find the newest hotspot and start the new trend. Sometimes even giving the management ideas themseleves about how to better market their club, and make the best improvements.
January 11th, 2008 at 2:06 am
Solid! I think you have it down.
January 19th, 2008 at 3:19 am
[...] A-Train finance compares the stock market to a night club. Yes, you read it right, and there ARE some [...]
March 10th, 2008 at 1:40 pm
hi. this is funny. it would be even better if i new how to invest. any tips for someone with savings?
August 14th, 2008 at 3:34 pm
Definitely a fun and interesting look at the stock market, I really enjoyed ones on the Long Term Investors and the NASDAQ.