Don’t Rely on Credentials: The Stock Market Cares About Results
When it comes to investing in the stock market, don’t take comfort in the fact that you own shares of a well-known company or that Wall Street experts may be recommending it. The stock market doesn’t care about credentials or reputations. Its verdict is solely based on the price of the security in question.
Looking Beyond Paper Credentials
Just like meeting someone in person can reveal a lack of chemistry despite impressive credentials on paper, investing in a company based solely on its reputation or future prospects can be risky. A person’s resume may represent the underlying company, but it’s the shares themselves that matter. When a primary bear market strikes, holding shares of a quality company may not provide the comfort or protection you expect.
The Market Doesn’t Care About Labels
No matter how “blue chip” a company may be, it can still put you in the red if the market moves against you. The stock market doesn’t pay attention to labels or reputations. It’s important to remember that investing in the stock market involves risks, regardless of a company’s credentials or reputation.
Conclusion
When making investment decisions, it’s crucial to look beyond credentials and reputations. The stock market’s verdict is final, and it’s based on the price of the security. Don’t rely on labels or recommendations alone. Instead, consider the real-world performance and potential risks associated with investing in any company.
(To be continued…)
This excerpt is taken from “Relationship Investing: Stock Market Therapy for Your Money” by Jeffrey S. Weiss. To read other articles of this book, click here. To buy this book, click here.
The Epoch Times copyright © 2023. The views and opinions expressed are those of the authors. They are meant for general informational purposes only and should not be construed or interpreted as a recommendation or solicitation. The Epoch Times does not provide investment, tax, legal, financial planning, estate planning, or any other personal finance advice. The Epoch Times holds no liability for the accuracy or timeliness of the information provided.
