Traders Laboratory - View Single Post - what feul this current bull run
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Old 05-26-2007, 11:25 AM
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Re: what feul this current bull run

Guys, keep in mind that your major fund managers - Fidelity, Vanguard, American Funds, etc - do not participate directly in the FX markets very much (if at all). The majority of these fund managers are fundamental based managers that are buying for the long term. They have too much money to simply buy and sell something rapidly. If has often been said that a huge fund manager is like a cruise ship when building/exiting a position - they cannot turn on a dime, like a small fund or retail trader. The reason this is important to know is that what is often referred to as 'smart money' is these guys. They are smart b/c have they have so much of it to allocate!

So as money just gets dumped into these managers laps, they must put it to work, usually right away, esp during bull runs. This is where these guys make their money.

In the end, the market is really pushed around as the result of the average Joe deciding to put additional money into the markets vs. putting that money to work somewhere else. The 'smart money' is subject to the emotions and feelings of the average investor b/c they are nothing w/o their money... food for thought.

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