The "daily Call" From Option Alpha: Options Trading | Stock Options | Stock Trading | Trading Online

Hey everyone. This is Kirk here again at optionalpha.com and welcome back to the daily call. Today, we are going to be talking about why the herd mentality continues to prove itself as a valuable indicator of potentially market tops and market bottoms. Herd mentality is basically a very simple concept that describes why investors in general, move in herds or clusters around generally bad ideas. Once it's often said, “Once the herd gets involved, it's basically the end of the road for bull and bear markets.” What you see often is you see a market that is starting to rise and starting to move up and then it starts to reach critical mass where everybody starts to succumb to the market and starts to buy in, whether they believe in it or not because everyone is doing it. It's this idea or fear of missing out that eventually gets everyone sucked into the concept or the purchase of shares or the selling of securities because that's basically what everyone else is doing and they don't want to be left behind, they don