Can stock prices be predicted?

First of all, the stock market is predictable, but predictability is the premise.

In the short term, the fluctuation of stock price is unpredictable. With the growth of the cycle, the longer the cycle, the higher the predictability.

Give an example to understand this sentence deeply.

1. If the Shanghai Composite Index is at 3300 today, if you want to predict how many points the Shanghai Composite Index will be tomorrow, or how many points the Shanghai Composite Index will be next Monday, then I think you are telling fortune. This may really be Brownian motion. Of course, people who have this kind of prediction idea are ignorant guesses.

2. If you want to predict whether the Shanghai Composite Index will be higher or lower than today's 3,300 points according to today's 3,300 points, then I think the predictability is very strong, and even the probability that you can predict that the Shanghai Composite Index will stand twice as high as 6,600 points in 2027 should be great. This is actually guiding your investment. If you invest a sum of money in the stock market now and withdraw money in 2027, you can calculate the probability of various yields, and the probability of success is relatively high.

To sum up, according to today's Shanghai Composite Index of 3,300 points, I think there may be a 50% probability higher than 3,300, and a 50% probability lower than 3,300. This is definitely the Brownian motion mentioned in the title. And it is greatly influenced by the news.

However, if today's 3300 points are used to predict whether the Shanghai Composite Index will be higher than 3300 after 10 years, then the high and low probabilities are definitely not 50% each. This requires you to try your best to predict and list the probabilities of all possible points to guide your investment.

Therefore, the stock market can be both an investment place and a speculative place. If you predict tomorrow's price every day, it is speculation. If you analyze the long-term trend of the future every day, it is investment. Of course, the long-term trend has also fallen, but it is much easier to predict the long-term rise and fall than to predict the rise and fall tomorrow. It doesn't mean that all stocks will go up and up for a long time.

It is not excluded that gods can predict the price trend tomorrow, but according to theoretical knowledge, they will not predict. Walton can learn relevant knowledge. Take care.

Hope to adopt