tailieunhanh - The Elements of Investing by Burton G. Malkiel and Charles D. Ellis Dec 14, 2009_3

Tham khảo tài liệu 'the elements of investing by burton g. malkiel and charles d. ellis dec 14, 2009_3', tài chính - ngân hàng, tài chính doanh nghiệp phục vụ nhu cầu học tập, nghiên cứu và làm việc hiệu quả | Index wouldn t know this when Wall Street throws everything but the kitchen sink at you to convince you otherwise. This is the plan we use ourselves for our retirement funds and this is the plan we urge you to follow too. NOBODY KNOWS MORE THAN THE MARKET It is difficult for most investors to believe that the stock market is actually smarter or better informed than they are. Most financial professionals still do not accept the premise perhaps because they earn lucrative fees and believe they can pick and choose the best stocks and beat the market. As the author Upton Sinclair observed a century ago It is difficult to get a man to understand something when his salary depends upon his not understanding it. The cold truth is that our financial markets while prone to occasional excesses of either optimism or pessimism are actually smarter than almost all individuals. Almost no investor consistently outperforms the market either by predicting its movements or by selecting particular stocks. Why is it that you can t hear some favorable piece of news on the radio or TV or read it on the Internet and use that information to make a favorable trade Because __ 31 __ The Elements of Investing an army of profit-seeking full-time professionals will have likely already pounced on the news to drive the stock price up before you have a chance to act. That s why the most important pieces of news such as takeover offers are announced when the market is closed. By the time trading opens the next day prices already reflect the offer. You can be sure that whatever news you hear has already been reflected in stock prices. Something that everyone knows is not worth knowing. Jason Zweig the personal financial columnist for the Wall Street Journal describes the situation as follows I m often accused of disempowering people because I refuse to give any credence to anyone hope of beating the market. The knowledge that I don need to know anything is an incredibly