Herd behavior: Lessons worth billions of dollars

Just four days after the information Nguyen Duc Kien arrested, hurricane currency on financial markets has been suspended with immediate and effective intervention of the authorities.

Echo left now is the bitter lesson worth billions to those who act according to the "mob mentality".

Crowd psychology - forever yet under learning

Although Nguyen Duc Kien is a founding entrepreneurs participated and have large stakes in banks, but in fact according to the latest statistics, he just kept large percentage of shares not in the bank and alsonot hold any formal leadership position. He only really famous for called "bau Kien" since the end of 2011 to the spokesperson, "shocking" and act "exclusive" in Vietnamese football.

Investors rush to sell shares in herd mentality, pushing the stock market in 3 days plunged more than 10%. With the stock market value of 800,000 billion, can see the money that investors lost not small.

Meanwhile, some speculators quick to enlist the price down to boost net purchase price, surfing.To end on 24/8, the market increase to awakening pity for those who has trot sell shares and secretly smile of investors "upstream".

Another move that expense since they have acted on unfounded rumors is that some people to withdraw money from the bank.Not just lose interest because of withdrawal with the current low level of inflation, interest rates on deposits (9-12%) for the first time after years of being at the ocean. So saving channel deposit is safe and effective in the current context.

Steady paddle hands

Securities and Exchange Commission, the two exchanges from the last few days have been notified in time, it is clear to advise investors to be careful, calm in securities trading when the market is showing signs plummeted.

SBV Governor Nguyen Van Binh, agencies such as the Ministry of Public Security, the State Bank, the Central Propaganda Department, the Ministry of Information and Communications has been a very close cooperation and active, the script needed todeal with all possible situations.

According to economic experts, due to the manner and lack of information, so the damage on the market mainly fall into the small investors. The past few days, while many people rush to withdraw money, buy gold, securities, foreign investors and a number of "sharks" calmly "consolidation" in the stock market. Particularly strong buying still takes place in the banking stocks, which are "on sale".

This event to the market is a chance to repeat the learning is not new to the people on the need for calm, careful, avoid listening to the rumor to cause harm to themselves and those around.

Vietnamese currency financial markets have repeatedly undergone changes and each so whoever stable, the field will be the "winner".

From Hoàng Yến

VnMedia