Recognizing Good and Bad Investment Information
We only have control of our actions. We do not have direct control of the world, or even how others will treat us. To me it seems as if the majority of investors attempt to control their returns and many even try to beat the market. Investing can be scary because we are putting our money in areas of the market we cannot directly control. But that’s okay. We have control over the type of portfolio we build—to make it globally diverse, low risk and high return. But most importantly, we have control over our reactions, and we have control over the information we put into our mind. If we put too much information from popular media outlets in our mind it can cloud our judgement and cause excessive anxiety. The key is getting the right information.
How to recognize bad investment information:
The source relies on viewership numbers for profit
Many of the main media outlets make their money on advertising and need to bring in as many viewers as possible. To do so they focus on exciting stories and exaggerations to stir up your emotions. An anxious viewer will watch more and more causing more anxiety.
They promise an easy way to make money or how to beat the market
The market works because no single investor can consistently make money at the expense of others. If there were ways to make money quick or beat the market the whole system would break down.
How to recognize good investment information:
In the investment world boring is better. Investing is about security for the future and being successful in the long run. If there are too many ups and downs your returns will not be as profitable in the long run than if you let the returns come in slow and steady.
It builds your confidence
When a bad year hits, many investors might become scared and begin acting differently than usual. They start to make bad decisions. The fact is that bad years happen, but so do good ones. The best advice that you can receive when things are going badly is the type that gives you confidence and helps you make the right decisions.
There are many aspects of investing that are in your control and that includes where you get your information from. By getting the right information and ignoring the majority of the popular media you will make better decisions and have less general anxiety in your life.