Stop the Madness – Stop Asking for Guru Opinions Whether Something is a Buy or Sell
Part of Art of Chart Reading
Many people likes the comfort of guru opinions, especially when that opinion agrees with their own. When the guru opinion, even if it is a great one, when reduced to a buy or sell, will loose most of its meaning and likely to be harmful to your trading decisions.
A Trading Decision is a Complex Decision
Unlike simple daily decisions like, do I eat a sandwich from Subway for lunch or do I pick a meal at the closest diner, trading decisions is way more complex. In fact, it is many times more complex than choosing among 2 to 3 choices.
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Comments
“Confirmation Bias” also aids and abets in this. Expert 1 is bullish; Expert 2 is not so bullish on a stock. If the trader/investor is bullish or is already in it and under water, there is a tendency to ignore Expert 2 and embrace Expert 1 to stay in the position and even add to it.
Looking forward to the new section….
Unfortunately most people still give too much weight to the clowns on tv.. Sad truth about how manipulated this all is.. I don’t think I’ve turned on one of those channels in years now and have no desire to do so.. Looking forward to the new section as well..
I neatly avoid the whole situation by not having a TV set in my living and trading areas. There is a TV in the house which I glance at when passing through – Last time I viewed CNBC was on 9/11/2001. Have no cable now – only some local channels.
Excellent article LC- Confidence in yourself and your strategy cannot be over-rated in this issue.