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Stock Trading Software Vs Human Brokers in 3 Aspects: Analysis, Cross Referencing, and Decision Making

January 16th, 2011

The rage about Humans Vs Machines is on again with the advent of smart free stock market software that can take into account all the factors that dictate how the stock market will behave. But how well do these software programs perform as compared to brokers in the three main fields of stock trading?

Analysis

Human brokers are admittedly at a disadvantage when it comes to analyzing the numeric data that the stock market follows. In terms of both processing speed and accuracy, humans can never outdo software when it comes to calculating the percentages, the statistical probabilities, and all the other measureable factors included in market analysis.

Cross Referencing

When we talk about cross referencing, we’re referring to current market patterns matched against previous patterns and if market conditions can replicate and thus repeat the patterns. Brokers with enough experience and knowledge in stock market history, trends, and patterns can predict how the stock market will behave if they see current market conditions are similar to what they once were in the past. Computers and software can do the same thing even better given that their databases are supplied with the related information.

Decision Making

Decision making in stock trading is dependent on the data and analysis and cross referencing made. And as we’ve seen above, software can do better jobs at all these compared to human brokers. But—and this is one big BUT—the final call needs to be left to human brokers. Why? The answer lies in the fact that there are unpredictable human market behaviors that no computer or software can effectively take into account as much as a human broker can.

So the final say is that software programs are invaluable assets, but they can’t be so much more than just assets.


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January 16th, 2011 14:05:33

Singapore Fund, Inc: The Risk of Investing in an Investment Company

August 23rd, 2009

The Singapore Fund, Inc. was created in May 1990. It is primarily a closed-end management investment company. Apart from this, the Singapore Fund, Inc. is also a non-diversified investment company which means it might not be ideal for your personal financial planning portfolio if you are risk adverse.

The company largely contributes its investments to Singapore’s equity securities  and to some issued by the companies located in the member countries of ASEAN. Although there is a large variety in the possible host countries, there is a larger discrepancy in the types of equity securities where one will find their investments. The Fund is connected in various industries, ranging from those in the banking and financing services to property development, electronics, engineering, personal care, tourism, environmental exploration, among others.

Although basically an established investment company, the Fund’s non-diversified character could pose a threat to those who are intending to invest in it. When investing in this kind of company, one’s finances is absorbed to the whole of the company and not to a particular industry or company. When a loss is incurred by one of the companies or industries under the fund, the rest may suffer from the same failure, however firmly established they may be.

However, one good thing about the Fund is that its investments can be found in different countries. Thus, the risk posed by its non-diversification is slightly reduced by the variety of the location of the investment.

Investing in an investment company like the Fund may be risky. However, it has continue to be popular among investors. As a matter of fact, its stock share price is rated at $13.80 as of August 06. The different markets that the Fund involves itself proves to be a feasible investment place. Stock market software may be making mistakes when making predictions in this kind of companies, but, experience and data would still be the best assistance for determining where to invest your money.


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August 23rd, 2009 18:41:30