Investing: Stocks, Research, Advice
Listening to investment gurus for advice can be a daunting task due to the sheer volume of information available. The advent of the internet has infinitely multiplied the access of advice to the individual investor. This is both good and bad, and caution is needed when acting on the advice.
The first thing to remember is never to rely on one source for all of your advice. Even the most brilliant people are fallible and are often wrong. The best thing to do is find a style that works more often than not and that increases the probability that you make money over time. Investing is a marathon, not a sprint.
Also, be careful about following somebody that has been dead wrong and capitulates and reverses course in the middle of a trend. For example, I read an article on Marketwatch.com about Norman Fosback’s Econometric model. This model has been bearish for some time and has predicted a slight loss over the subsequent 12 months this past summer. However, it has now changed to predict an 11% return over the next 12 months.
This does not mean that there is no value to be extracted from Mr. Fosback’s model, but it does illustrate the point not to be too devoted to one methodology. I am sure investors who sat out of the market were angry to miss those gains, only to see his model now predicting double-digit gains over the next year.
This is by no means groundbreaking advice, but it is something to think about. Diversify your portfolio and your sources of advice.
With more than eight years of experience in investing, Ashish Gupta started his financial website www.istockanalyst.com
iStockAnalyst (www.istockanalyst.com) is the website dedicated to individual investors. The company is building a virtual investors community and supercharges the community with set of tools like chat rooms, message boards, actionable streaming commentary, streaming RSS aggregator, whisper number, comparative charting, blogs, integrated research, educational articles and more.
iStockAnalyst.com released earnings estimator tool in third quarter of this year. The tool is based on estimates entered by individual investors. The individual investors follow these companies very closely and they have good estimates about earnings. In last quarter a good number of companies reported earnings inline to estimates.
iStockAnalyst.com also offers live commentary (real time news analysis) in streaming format to help individuals investors take informed and timely decision.
