Wise Advice for Investors and Traders on "Experts"

[Garpal Gumnut]

There are hundreds of thousands of words written every day on what one should invest in. What you read does have an effect on your decision making. Marketers of financial products know this as do amateur stock pickers. This post is advice on the latter, amateur stock pickers, some of whom post on ASF. For reasons known only to themselves and their medical/mental health advisers they boldly spruick stock picks.

Avoid them.

They often have some ulterior motive associated with a deficient personality. Markers to be wary of are

• Posting in bold and in capitals like this AHOY
• Being dismissive of other posters
• Being thin skinned and blocking other posters who disagree
• Engendering negative emotions in other members of a forum
• Picking arguments for arguments sake
• Being absolutely sure of their positions

Often your own experience is better than any stock pickers. Trust your gut, it is often better than other poster's opinions. Use your own expertise, e.g if you work in retail look at some retail stocks. See how your workplace runs compared to listed retail companies. Are supermarket or hardware staff rude and hassled with few people going through and buying. This is basic fundamental analysis.

If you read a poster's chart which is absolutely sure of a stock or commodity's future projection beware. Do a short course or buy a book on charting. The basics of charting are all you need. The more complicated a chart is the less likely it is to predict the future. And remember no chart can predict the future, only provide a likelihood, just like your fundamental assessment of a business if you are a retail worker.

This is not beginner's advice. It is just common sense advice for those on forums and trying to work out the nuts and bolts of stock investing, and the preparation in reading advice of forum posters on sites such as Aussie Stock Forums. It can be daunting but it is worthwhile, to separate the wheat from the Seaweed.

gg

 

[Dona Ferentes]

to which I would add, take with a pinch of salt anyone who refers to such amateur stockpickers, gifted, lucky or otherwise, as sheep, and has an embedded link to another, usually their own, website / vanity project.

Now, it is well documented that 'sheep' is a term used in boiler rooms and other equivalents of modern slavery by the operators as a general descriptor of their prey, the vulnerable, confused, deluded or greedy, whom they look upon as a source of plunder, to be fleeced or fed to the wolves.

 

[eskys]

to which I would add, take with a pinch of salt anyone who refers to such amateur stockpickers, gifted, lucky or otherwise, as sheep, and has an embedded link to another, usually their own, website / vanity project.

Now, it is well documented that 'sheep' is a term used in boiler rooms and other equivalents of modern slavery by the operators as a general descriptor of their prey, the vulnerable, confused, deluded or greedy, whom they look upon as a source of plunder, to be fleeced or fed to the wolves.

Labelling,derogative nouns, adjectives aren't the best form of communication. But alas, some grew up with what we were taught....so it's now our job to re educate ourselves. Our brain waves were pieced together by environment and to a some extent, genetics. Ask any neonatologist and he will tell you that what we learn from a baby to the age of 5 are crucial stages of our lives....teach a kid the wrong thing, he learns the wrong thing. But we don't have to stay that way...we can unlearn in our sunset years

 

[Smurf1976]

Being absolutely sure of their positions

This goes for anything, not limited to stocks.

Real experts on any subject may well be able to confidently state a position but they'll do so in a very specific context, being very aware it applies only to that context.

Real experts will thus ask a lot of questions about a situation because they need to confirm the details in order to give an appropriate recommendation. That applies to everything from finance to house painting to buying tools or machinery. If you're dealing with an expert, they'll want to know a lot about your situation.

Non-experts will tend to confidently state a "one size fits all" solution. They'll tend to become defensive if anyone criticises it or proposes alternatives.

Noting the legal bit that nobody without the required license can give "financial advice", and that term has a specific meaning under law, but anyone can give their opinion or state what they'd personally do. Posts on this forum on financial matters are in that category - they're someone's opinion or statement of what they'd do or have done, but they're not "financial advice" in the legal sense of that term since only a licensed person can give "financial advice".