Topic: How To Invest

What is Pat’s commentary for the week of December 3, 2019

Article Excerpt

Early in my investment career, before I had much money of my own to invest, I took a strong interest in market indicators (also known as investor rules of thumb, investor guidelines, market lore and so on). Who could resist? Market indicators seemed to provide a short cut to making money in the stock market. To top it off, most were simple enough to fit on a T-shirt. As I learned more, I wrote about them in The Investment Reporter, where I worked at the time as writer/editor. Readers liked these analyses and wanted more. I was happy to oblige, for my own interest as well as theirs. But as time passed, I got disenchanted. The more I looked into investor rules, the clearer it became that the best ones were not delivering consistent value for investors, and the worst ones were increasing investor risk. The problem is that an investment indicator uses only a tiny fraction of all the information that…