What not to do as an Investor !

Question

I was in my Corporate Finance Class today when my instructor said something, I could relate a lot to. He said that we should not look up "7 Sectors You want to Invest in" or watch those shows in which suited individuals debate over which security has the maximum "upside" or which ones to sell as the target price has been lowered by a popular investment research firm. I felt he actually made a lot of sense.

Such shares are already bought by HNIs(High Net Individuals) and it is the task of these media outlets to popularise purchase of equities in the secondary markets.

Winsight · Accepted Answer

Dear -

I quote an article in the Belgian financial press (De Tijd) of 2015-02-28

"According to a study by McKinsey, quoted family businesses in Europe have achieved an average return of 7 percent since 1997, compared to 6 percent for MSCI Europe. That is a difference of 1 percentage point per year, but in a decade it makes a big difference. The University of Toronto calculated that the Canadian family businesses had an average growth of 7.7 percent per year over the past 15 years, compared to 6.1 percent for the multinationals.

FitnessandFinance · Answer

I agree so far to say never buy something strictly because XYZ said it on channel 123.  However, knowledge is power and the more you know about a certain position or sector can't hurt, just take everything you hear with a (large) grain of salt.  Everyone is pushing an agenda at all times, but I wouldn't turn yourself off from any medium of information.

I don't think it is the task of media outlets to popularize the purchase of equities in the secondary markets.  The media outlets are there to to provide viewers with what seems to be quality information in an attempt to gain more viewers.

thebrofessor · Answer

the media's job is to create entertaining content, rather than quality content, they are more likely than not investment professionals with a book to talk, rather than someone with a compelling track record.

Winsight · Answer

)Dear -

A long time ago (1984), I made my thesis about the efficiency of secondary capital markets. Conclusion was they were inefficient and I think that still counts. During the banking crisis, I bought bank shares and I still have these with a good but unrealized profit.

Another advice : look at what investors do who are influential and invest their own money. Such as … Warren Buffet.

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What not to do as an Investor !

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What not to do as an Investor !

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