When you become interested in a stock
or mutual fund you can call your broker and he
will send you reports on how the company is doing,
what their management is like and what might be
the projected earnings for the company and how the
industry is doing. Great information.
You will apply yourself to this mound
of papers to determine if you want to buy the
equity. You might also send for more reports from
independent analysts such as Morningstar. You will
become buried in papers. That is what the
brokerage company wants. The reason is very
simple. If you buy the stock after doing all that
research and it goes down instead of up they are
not responsible for your stupidity. Of course, if
it goes up they can take credit for providing all
that great information.
Now let’s think for a minute. You
received all that information that was already
printed so it could be sent to you. It makes me
ask when was that printed? How old is the
information? If I can get all this stuff about the
company it means that anyone can. What it boils
down to is the information is just that –
information and none of it will tell you that the
stock will go up further because the whole world
These brochures are made to help you
BUY not SELL. In my years of experience I call
them a work of fiction. No brokerage company is
going to issue a bad report about a company at
least until it is ready for bankruptcy and by then
your investment dollars have disappeared.
I know your next question. If I can’t
rely on those reports how am I going to buy
anything? There is a better way. You will want to
see the price action of the stock or mutual fund.
All stocks undulate as they go up or down and you
want to know the major trend.
On the Internet you can go to a web
site http://www.bigcharts.com and type in the symbol of
the stock or fund and request a weekly chart going
back for about to 5 years. What you are interested
in is what is it doing during the past 6 months to
one year. If the trend is up it is a buy and if
the trend is down or sideways don’t buy it or if
you own it sell. See how easy that is. Brokers and
financial planners won’t like it because it takes
all the mystery out of buying stock and they don’t
want you to know this simple procedure.
Analyst reports give you lots of
useless information, but will not tell if the
stock will go up after you buy it. If it isn’t
going up don’t buy it.
Al Thomas’ book, “If It Doesn’t Go Up, Don’t Buy It!” has helped thousands of people make money and keep their profits with his simple 2-step method. Read the first chapter at http://www.mutualfundmagic.com and discover why he’s the man that Wall Street does not want you to know.