One of the many dilemmas investors face is where to find good information. By good I mean accurate, unbiased, relevant, and meaningful. That’s a tall order, but I can say from experience (I’ve been investing professionally for 30 years) that it’s out there… if you know where to look, and if you know how to interpret the often cryptic messages.
Submitted here for your approval (tip of the hat to Rod Serling) is an example of an article about investing that violates almost every standard of “good information” imaginable. The only thing that’s missing is a call-to-action involving the surrender of your credit card details. I will not name the offending website due to my desire to avoid a lawsuit, but the sad truth is that articles like this are very common in an industry (personal finance and investment advice marketing) that is largely unregulated.
Why am I picking on this author, and what do I hope to gain? Aside from my distaste for bad writing in general, I hope my readers will see this as a learning moment. Sometimes you have to look at the low end of the quality scale in order to recognize and appreciate the high end stuff. It’s in this spirit that I offer my thoughts.
If you are so inclined, I encourage you to read the article and see if you can spot the violations of common sense and logic. Send me an email or use the comment section below, and I will respond with feedback about how skilled you are at recognizing bad journalism.
“There are a lot of people realizing they can actually invest their money to watch it grow, yet few take initiative or know where to begin. As a result you see some people invest their money carelessly as well. This article has a lot of information you can learn about how you can make wise investments.
Before you dive head first into trading stocks, make sure to watch the market for a while to get a feel for it. Keeping track of the market before you decide to buy can help you know what you’re doing. A sensible rule to follow is to withhold any major investment until you have spent three years closely watching market activity. If you wait long enough, you will know how the market functions and you will be making the right decisions.
Anytime you choose to make a stock investment, keep your outlay to less than ten percent of available funds. If the stock goes into decline later on, this helps you greatly reduce your risk. Short-selling is a great method of trading to try.
Short selling involves “borrowing” shares for a set period of time. An investor will borrow shares through an agreement of delivering the same quantity of those shares at a future date. The investor will then sell the shares which can be bought again when the price of the stock drops.
Recognize where your understanding ends and do not invest in companies which you do not fully understand. If you are going into investing alone then make sure that you know all that you can about the companies you plan to invest into. While you might know how to judge a landlord, can you judge a company that makes oil rigs? Work with a professional broker or advisor to make these kinds of investing decisions.
In order to make your stock market investments the most successful, you need to map out a specific plan with strategies and future goals. The plan needs to have times of when to sell and buy. It should also include a clearly defined budget for your investments. By having a detailed plan, you will be able to make stock purchases without buying on impulse.
Make sure you are investing in damaged stocks, not damaged businesses. A company’s stock price might be going through a temporary downturn, and that makes it a great time to get in on a good price, but just be sure it is in fact only a temporary setback. Investor panic, due to an important but repairable problem, can cause a sharp drop in a stock’s price. On the other hand, a drop in stock value for a company that is being investigated for fraud is probably not temporary.
Even if you are positive that you will be trading stocks on your own, it is best to consult a financial adviser. A good professional wont just give you great individual stock picks. They will also sit down and tell you of your risk tolerance, and the time horizon associated to your financial goals. You can both then develop a customized plan that will help you to achieve your goals.
Stay away from any stock advice that you did not ask for. Of course, you want to listen to your financial adviser, especially if they are successful. Don’t listen to any other attempts people make to offer you advice. There really is no better advice to follow than what your own research indicates, and most unsolicited advice is being given only because they profit from it in some way.
This article here will give you greater knowledge when it comes to the stock market. You should now have a better understanding on how to invest and make money in the market. Always be aware of the fact that it takes risk in order to get rewarded, so use this knowledge from the article and incorporate it into your own investment decisions for the best chance at success.”
One final note. As I re-read the article one last time it occurred to me that it’s possible that it was written by a literature bot. They’re out there. It would not surprise me to learn that someone taught a computer algorithm to string together several investing catch phrases and connect them with grammatically correct connectors. These algos are sophisticated enough to form complete sentences, and to structure paragraphs that are intelligible if not intelligent.
So if this article is in fact written by a bot, please accept my apologies. I would not want to offend my cyborg friends in the investment business.