In our efforts to gather the information we need to become smarter investors, we look everywhere: books and magazines, videos, seminars, webinars, TV and the internet - just to name a few. The amount of market information available to the common man these days is amazing. Much of it can be accessed freely. It is there for the taking if we are willing to spend the time and effort to absorb it.
As we gather this abundance of information, however, there is one thing we must consider and that is the source of that information. Is it a reliable source? Is it a trustworthy source? What are the backgrounds and the credentials of the person or persons presenting the information?
Consider these headlines, all taken from financial media outlets in just the past couple of days:
> "Morgan Stanley Predicts Stock Market Surge"
> "Expert Forecasts Recession in 2015"
> "S&P 500 to 2,200 Next Year"
> "Why the Next Stock Market Crash Will Happen Any Day Now"
The articles associated with these headlines were all distributed by some well-known financial institutions. Each one was well written and included data to back up the claims. In short, they were very persuasive articles. Yet two of them were calling for a high-flying bull market while the other two were predicting a doom-and-gloom bear market. Which are we to believe?
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Finding reliable sources for investment information isn't quite as tough as finding a needle in a haystack, but it's close. In the 16 years I've been sifting and sorting through different types of market data, I've only found a handful of what I would call reliable sources; that is, people I pay attention to on a regular basis. Even then I take what they say with a grain of salt.
I say that because no one - no one - can predict where the stock market is going. The "experts" who wrote the articles above have some solid opinions, but they are only guessing. They are educated guesses to be sure, but guesses all the same. Two of them may be right and two of them may be wrong. Actually, they may all end up being wrong: 2015 could see the S&P 500 move sideways for the entire year, just as it did in 2011. No one really knows.
The learning process for people who want to make their own investment decisions is a lifelong one. The best investors are the ones who never stop learning and growing as students of the markets. A large part of that process involves continuously digesting lots of information and finding sources that can be trusted. At the start that can seem like a pretty big task, but it doesn't take long for beginning investors find their "handful of reliable sources."
They will learn to look for people who:
> have like-minded investment styles and market approaches
> present their information in an even-handed way (never too excited, never too gloomy)
> don't make excuses when they are wrong and don't thump their chests when they are right
There are literally hundreds of sources for market and investment information available today from a wide variety of media. Finding the ones that you want to "pay attention to" is part of the never-ending learning process. When it comes to investing your hard-earned money, it is well worth the effort.
Paul Montague built http://www.hardhatinvestments.com as a means of helping busy working folks learn how to better invest in their 401(k) or IRA retirement plans. Information provided on the website introduces investors to the basics of "Trend Following," a long term investment method that is both easy to understand and easy to monitor. The goal of this free website is to help everyone become competent, confident investors, regardless of how little experience - or spare time - they may have.
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