subject: The 4 Biggest Investment Lies [print this page] We receive a lot of email and advertisementsWe receive a lot of email and advertisements. The following comments came from a solicitation from VectorVest on September 27, 2010. The comments mirror some of our thoughts and we thought we would just post them as is and add a few comments.
The following big lies have been repeated so long and so often that they are now accepted as fact.
Big lie #1:
You can't time the market
This is pure nonsense. The reason Wall Street continues to say it is because of greed. You see, they want your money to keep coming into their coffers until you have nothing left.
A little strong, but we agree with the thought. Cymorfund beats the market on a regular basis, as do some other hedge funds.
Big lie #2:
You should buy stocks on the way down
Well gee, if a stock was a good buy at $50 a share, it's bound to be a better buy at $10 a share. And when it sinks to $1, you could be very sorry you went along for the ride.
This statement is very accurate. So often we hear the comment that You should average down', or Buy it because it is cheap now'. These comments are a true formula for losing money. One should NEVER average down, It is a fool's game. A stock that is falling is not a stock that you want to purchase.
Big lie #3:
You should buy and hold
Using a buy and hold strategy in today's volatile market can provide you just one thing: Big losses! The crash of 2008 should have taught every investor this lesson.
Well, we have said many times that Buy and Hold' is the exact wrong strategy. Read some of our previous blogs.
Big lie #4:
You can't beat the market
Huh? Tell that to the thousands of investors who made big profits in 2009.
There will always be a few losers in a portfolio, because no one can accurately predict all events in the future. But following investing principles and being quite firm in following your own rules, will lead to continuing and sustained profits.
The 4 Biggest Investment Lies
By: Larry Cyna
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