Reviewed by Oct 05, 2020| Updated on
The term tide is an ordinarily used metaphor in the world of financial markets to narrate a wide trend, which is administered by large, macro power out of the authority of any individual investor, organisation, and even the economy.
In the studies of the physical oceanography, the tide is a word that points to the phenomenon of the ocean levels falling and rising because of the influence of the gravitational forces resulting due to the presence of the moon and the sun. The tides are of significant interest to mankind ever since the beginning of the history of humans.
The tides have direct effects on humans as they affect sea navigations and other similar activities. As tides are influenced and a result of the presence of the heavenly bodies that are not in control of any organisation or individuals, and they impact the human activities the word ‘tide’ is making a handy metaphor for narrating financial markets.
Like oceans, the financial markets are impacted by extremely powerful forces that are not under the control of any individual investor, organisation, or any other market participant. For example, the worth of the equity market is impacted by forces such as business cycles, the moves made by the central banks across the world, collective psychology, and trends that are demographic in nature.
As forces mentioned act individually or in unison, they affect the worth of the capital assets being traded in the financial markets. Investors should necessarily pay utmost attention to these, and if not, their investment runs the risk of being ruined.