Dear Mr. Market:
The stock market has provided many sayings and memorable catchphrases that people tend to regurgitate ; some have merit and some are just garbage.
If you’re a regular reader of Dear Mr. Market, or a client of My Portfolio Guide, LLC, you’ll know that our all-time favorite is “The four most dangerous words in investing are …This time it’s different” -Sir John Templeton. Here are some other all-time adages that you’ve undoubtedly heard:
“Buy low sell high” Uh…yeah, but easier said than done.
“The trend is your friend” Sure….until it’s not!
“If you have trouble imagining a 20% loss in the stock market, you shouldn’t be in stocks” -John Bogle
“Markets can stay irrational longer than you can stay solvent” -John Maynard Keynes
So…what does “buy the rumor and sell the news” mean? You probably know that the stock market is full of speculation, great stories, and chock-full of hidden nuggets as well as potential land mines. Even if you’re not an experienced investor or trader, at some point you’ll figure out that by the time your neighbor (you know the guy who never loses and is always up) tells you about a stock tip…the ink on the newspaper is already dry and that idea is likely stale.Continue reading