The fear of missing something probably contributed to the fact that the German share index (Dax) reached a new high for the year this week with relatively thin sales.
What role do TINA and FOMO, the two main drivers of stock prices in recent years, actually play at the moment? TINA (There is no alternative) has now receded into the background. After years of not being an alternative to shares for many investors because of the lack of interest, bonds have long been back in the game.
FOMO (fear of missing out), on the other hand, seems to be very modern again: Many investors are afraid of missing out on a new stock rally once the banking crisis has abated.
This fear usually plagues professionals even more than private investors. Because asset managers report again and again that their customers are more likely to forgive a drop in prices than missed opportunities in an upswing. When prices collapse, it hits most investors, and as an investor you can excuse yourself by saying that the others were no smarter either. On the other hand, if you miss the rally, it looks like you missed the development.
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