Topic: How To Invest

What is Pat’s commentary for the week of April 18, 2023

Article Excerpt

Last week in this space, I mentioned that beginning investors may develop an unrealistic idea of how much money they can make by delving into short-term stock trading. It seems obvious to them that all it takes is some good advice from an expert. However, any true investing expert understands that random factors play a big role in short-term stock price fluctuations. That’s why these movements are unpredictable. No outsider consistently profits from them. In fact, there’s a lot of randomness in the stock market, and a lot of conflicts of interest. You have to take that into account if you hope to succeed as an investor. Many investors try to outperform the stock market by going in and out of it erratically, based on their assessment of risk and potential reward. The trouble is that these risk assessments rise and fall with day-to-day or month-to-month economic and business developments, which are also subject to the influence of random factors and conflicts of…