Positive Bias on Wall street

February 16, 2010

Wall street is a place where people are very biased for their own profits. One angle this can be analysed is when the analysts give out reports, why are there almost always more positive analyst reports than negative ones.
The negative reports target the investors which own the stock. So that is a limited market composed of only the people who own the stock, because they are the only ones who’ll actively be seeking such information( Umm maybe short sellers too, although small in number), while when we see that the greater number of positive analyst reports suggest that there is a bigger market there, which targets people who own the stock as well as people who are considering buying the stock.
So more coverage, and creating a small positive bias for all the investors to buy the stock, one of the factors, maybe a very delicate one, but I guess would affect the direction of the market in general.


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