Sunday, June 17, 2018

Price And Value Relationship and the Psychology behind it...

Relationship between Value and price...

We human beings are prone to evaluate all things by price wise and we don't have the capacity and power to evaluate all things by its  Value ...we are not born to process Value..... naturally the first thing our brain processes is the price of all things and to us human beings the Value comes second....

Why is it so....

Because giving price to things is very easy and quick job....in our everyday life 99% of the times everyday our buying or selling things is done by Price wise manner only....and correspondingly we don't analyse and evaluate things we buy and sell in our everyday life....I mean it is not possible at all to analyse and evaluate and calculate the Value of all things you are buying or selling in every day life....So our brain is in auto pilot mode and we develop the habit to evaluate all things by Price wise manner....

And also because in obtaining the Value of things you have to gather data.... analyse the data...do calculation form those data.... and then obtain the Value of things which is a lengthy and difficult process....so our brain has to work and consume precious energy in doing such difficult analytical job....so it does not want to spend the precious energy in such jobs and save the same energy to do other jobs and perform our other day to day tasks...So our brain wants to take short cut and moves our attention to The auto pilot system of evaluating things by Price wise manner....and makes us run away from calculating the Value of things....

The reason most percentage of people did not like mathematics in school is because our brain did not want us to solve those analytical problems....

So in stock market we always say Reliance@1030.... Now it will go to @1150/- in few months....and in all these we forget what is the actual Value of Reliance and is it Value for money @1030....
If you read all the above articles I have posted only then you will all understand clearly what is my.... Formula Purchasing price all about... and how it helps to buy and sell a stock....

No comments:

Post a Comment