5 Statements About the Stock Market That Make You Sound Dumb
This happens on social media WAY more often than it should or needs to: embarrassingly dumb statements about investing. I've heard some pretty creative ones over the years, but these ones take the cake for sure. Please stop saying stuff like this: you're embarassing yourself.
1. "Who cares about stocks except for old, rich white men"
Fun fact: old, rich, white men are not the only ones with money anymore. I know, what a concept? Using that as an excuse to not show an interest in the stock market is, quite frankly, stupid. So you go to Starbucks everyday and buy a venti double-shot soy milk Chai latte, and think it's stupid to own stock in Starbucks because "some old, rich, white guy is going to get all the money anyway." If you're not buying stocks where you shop, yeah, you ARE making someone else very rich. What they should say INSTEAD: Literally anything else. Just kidding, they should acknowledge that money does not work harder for old, rich white men -- investing works for EVERYONE. Period.
2. "I just bought stock in a new company because it’s a SURE THING."
The only two sure things in life are, in the immortal words of Benjamin Franklin, death and taxes. That's it. If someone told you that a stock is a "sure thing" I would greatly question the source. If was your broker, I would see the statement above. If it were a friend or family member, I would highly question their source. What they should say INSTEAD: I have done lots of research, analysis, and due diligence on this new company and all evidence leads me to believe that the stock will perform well over the next year.
3. "The stock market is TERRIBLE right now, I would NOT buy anything." The old adage of 'buy low, sell high' is not a joke - it's precisely what you should be doing. While the stock market sinks to 52-week lows, it will not be in free fall forever. Buying at the bottom will set up your retirement and investing on the right path much sooner than if you're already riding stocks higher at the top. What they should say INSTEAD: The market is now at new lows and I've created a buy list to execute once the market looks like its leveling out.
4. "I made ($X,000) in the stock market today."
My follow-up question of course is, did you sell the stock(s)? Nine times out of ten they didn't sell that day and just let the market close out the day on a positive note. In other words, they didn't make any money at all. You could be ahead in a poker game or in roulette, but until you cash out, you didn't really win anything. This is a classic example of counting your chickens before they hatch. What they should say INSTEAD: "A stock(s) in my portfolio gained $X,000 today, but I have reason to believe that it's headed higher in the long term so I decided to hold".
5. "I have a new broker who guarantees that I'll beat the market!"
A) A broker is never necessary to do well in the stock market, and B) if you have a broker who guarantees ANYTHING, you may want to reconsider hiring that broker. And if it is true that your broker is 100% right 100% of the time, you may want to place a call to the SEC (that's the Securities and Exchange Commission). What they should say INSTEAD: I have a new broker who comes highly recommended because they help their clients to outperform their designated benchmarks on an annual basis. BONUS: Even SMARTER thing to say: "I've been reading GradMoney every day to learn how to invest stocks properly for my own goals and needs!"