Tuesday, March 11, 2014

Boeing's Stock IQ and Stock EQ

Warning, Opinion Only

Investors in the stock market and its players, often ply the market with programed transactions and instinctive timing. Using both the IQ investment (Intelligence) and EQ instincts (Emotional Intelligence). Where IQ stands for the extensive stock research models often taught in Business schools. Its IQ players use earning ratios and returns on equity, extracting the investment knowledge of when to buy or sell. The EQ, or "Emotional Intelligence", interjects quick buys or sells based on experience, self awareness, and knowledge of resources.  Boeing is now entering an EQ phase of dumping stock. Look back just one week on Boeing's horrible week of news. The disappearance of flight MH370 with its 777-200ER over Malaysia's region. Japan Airlines in-flight engine shutdown near Hawaii, and cracks discovered in the wing assembly coming from the factory.

EQ mental structures take over the stock market under those conditions. In spite of
the formulated stock market buy or sell algorithms. The EQ portion of decision making looks for the optimal spot to sell Boeing stock. Under the cover of bad news of investor's self awareness , investors will repositions itself on Boeing stock in hopes of buying back in at Boeing's new bottom. The "company" will swing back before spring is over.  A triggering event(s) has occurred affecting the EQ Stock market. Common sense, or self awareness will replace that swing  well before summer. The market will climb on statistical and timing sensibility of both the IQ and EQ part of a brains own decision making for those devout investors.

Filters on the mind affect decision-making and sometimes the market increases and decreases, effectively blasting through those mental filters causing an anomaly in both the micro or macro market. The micro market is your own investment portfolio, where the macro market is the stock exchange on the whole. The EQ elements are in play on your decision making attributes, and it tests your EQ maturity for those things to come. The IQ is relied upon to justify the EQ decision-making. That is a dangerous position as models can be affected by unforeseen forces. Programmers try to out guess trends and are often thwarted. The EQ investors from penny stock upwards, gets lucky on insight, and the self awareness of external indices affecting the price.  This may be a confusing concept in a short blog space. Therefore, I will attempt to boil it down in a simple picture for Boeing.

Boeing is a Blue Chip Stock, a stock with over-all longevity and solid performance. During its historical market position it will blip at times upwards or downwards. During those times the "players" come out and play and the retirement community of investors will go fishing on its yachts. The buy/sell cycle accelerates, and is spurned on by news and set backs. The retired portion of stockholders, or the EQ lot, know that the big picture will over-all, play well, as it keeps a weather eye for big, big mishaps!

For both investor types, IQ or EQ, once Boeing takes this dip, it would be an opportunity to strengthen one's own portfolio before the stock upswings again. Boeing has put all its marbles, future and wealth on the table. They are driven to make the family of its aircraft succeed. It is also driven in its science and military endeavors. Being, a Blue Chip player has a heavy mantle around its shoulders. It will stay with refinement through its repositioning efforts of its 787 manufacturing, advanced improvement of concepts, and attention to detail. Boeing is at the cusp of making it right. Failure to do so is not an option. Boeing will place its best resources at critical junctions. Everett should build the higher risk projects at this time, and give Charleston its proven processes. To move things to Charleston because its cheaper is a fools mission. Boeing needs to match its risks to its talent. The second team should not start in the "Super Bowl" of airplane manufacturing until it earns its chops.  If Boeing takes its mental momentum forward without consulting its own IQ and EQ, then the market will react accordingly and pull its money back.

The questions before you are:
Do you use your EQ to Buy?
Or your IQ to Sell?
or vise versa?