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- Topic: Thoughts on finance community
|Author||Topic: Thoughts on finance community|
|Appreciate most of the insight on this board. I wanted to get feedback on this general impression that I have of the finance industry, specifically money management. It seems that so much of the commentary out there is utterly pointless and refers to things that have already happened. I'll give you a specific example. I was watching CNBC and they had this analyst, Fadel Gheit, who was talking about oil stocks. He goes on and on about how commodity prices are high. This information is blatantly obvious to anyone who spends a second looking at an oil or natural gas chart. And here's the real kicker...when the host, Jim Cramer asks him about his thoughts of oil stocks going forward, Gheit rambles something about the issue of investors might not be willing to pay a certain multiple for the Exxon's and Chevron's of the world. Basically, he doesn't know how these stocks will do in the future (he doesn't have a crystal ball). So in essence, guys like these add no value. All they do is report on what's out there and state the obvious.
Another example is Investor's Business Daily. I like what some of what they say, but alot of times, it is very much an after the fact matter. For example, I own ITT Technical Institute. For a while, that stock and Career education where on the IBD 100 list. Then all of a sudden, the stocks took a hit one week and then the stocks were off the list. This is all after the fact.
I guess all the intelligent money makers don't talk to the press and share their thoughts (i.e. the top hedge funds). Publications like Barron's, Businessweek, WSJ...all stating common wisdom and a waste of time to read. I'd like to hear your opinions. Any good financial texts or publications out there?
i agree with much of what you have said here. so where does this leave you and your interest in the industry? what kinds of positions do you think would satisfy you, knowing that most market coverage and analyst are simply regurgitating facts.
I ask as I share a somewhat similar opinion.
|I agree - I think most of the Jim Cramers of the world are catering to the 'man on the street' who doesn't know a great deal. I work for a bank in Canada and I often open Self Trading/Discount Brokerage accounts for our customers and I often wonder what the hell they think they're going to buy/sell. Most of these self-traders are way over confident about their abilities and will watch the BNN channel, CNBC etc etc. I seldom see successful 'regular guy' investors.
I was watching the BNN channel the other day actually, and the consultant analyst/trader was a commodity specialist talking about mining stocks and some oil exploration stocks. I caller phoned into the show to ask the analyst what he thought about 'XYZ Mining Stock' as the caller had just purchased 3000 stocks. The analyst began by saying, 'Finally, I get to speak to a man with money!'.
The point I'm trying to make as that a lot of customers out there I see trying to trade stocks and make money don't do much better than a good honest balanced mutual fund (certainly on a risk adjusted basis) and very often they'll do much worse - they're mostly over confident folks with no money trading away like no tomorrow! These are pretty much the people who are lapping up Jim Cramer's every word.
Sorry if I seemed slightly off topic but this thread reminded me the customers who would soak up this kind of outdated (and quite obvious) information and treat it like they've just discovered the best kept secret.
CFA Discussion Topic: Thoughts on finance community
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