Title: Why You Should Ignore Stock Recommendations from "Experts" (Free Money Finance)
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March 03, 2011
Why You Should Ignore Stock Recommendations from "Experts"
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Content: Why You Should Ignore Stock Recommendations from "Experts" (Free Money Finance)
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March 03, 2011
Why You Should Ignore Stock Recommendations from "Experts"
Jane Bryant Quinn does a masterful job of explaining why you should ignore stock recommendations from "experts". Her basic argument (with support from several sources): stockbrokers, fund managers, analysts, and the like are poor stock pickers, consistently doing very poorly versus the market over the long-run. Some highlights: Investors use stockbrokers and investment managers for what they assume is their market-beating advice in picking stocks. FAIL. A new report from Bloomberg News finds that equity analysts are not only wrong when they list “best buys,” they’re spectacularly wrong. For all of their computers, MBAs, and six-figure bonuses, they follow the herd into stocks that underperform. Mutual fund managers do the same. As a group, they rarely beat the market as a whole.