5 Stupid Wall Street Sayings

They might be common cliches, but that doesn't make them right

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5 Stupid Wall Street Sayings

‘Buy companies, not stocks’

bullseye pinpoint on target 630 300x225 5 Stupid Wall Street SayingsThis might have been solid advice a couple of decades ago when a stock’s price was a reflection of a company’s operation, slightly adjusted higher or lower depending on the organization’s plausible outlook.

But that’s not how stocks are priced in the modern era.

For better or worse, the stock market in the 21st century is something of a chess match, where you’re trading largely based on how you feel the rest of the market is going to feel about a stock anywhere from five days to 12 months down the road. That shell game doesn’t leave much room for an actual value-based assessment of a company’s operation.

Most mainstream investing books still don’t acknowledge this reality, but veteran traders know it’s how the game is played these days.


Article printed from InvestorPlace Media, http://investorplace.com/2013/09/5-stupid-wall-street-sayings/.

©2014 InvestorPlace Media, LLC

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