I just came across this cartoon on Reddit. It’s from The Economist and I thought it was a good enough explanation of panic selling that it was worth sharing.
Figuring out a way to get your signal to noise ratio under control is an essential thing for profitable traders, as well as investors. Whether it be from the financial press, the options market or any other element that guides you in your buying and selling.
As I have quoted on my StockTwits profile is a line from Mr. Buffet.
“I will tell you how to become rich. Close the doors. Be fearful when others are greedy. Be greedy when others are fearful.”Warren Buffet
Here’s the cartoon.