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Slimebeast on 28 August 2012
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HappySqurriel said:
Chuva said:

Do you want a real advice? Stop taking advice from strangers on the internet. Go talk to someone in real life who is experienced and that you trust. The number of angry teenagers who think they have life all figured out is way too high on the interwebz(I mean that you probably will see a lot of advice from them).


I would generally give the opposite advice ...

Try to get as much information from as many different sources as possible, try to understand the reasons behind the investments they suggest, and figure out why they're giving the advice they're giving.

There really are no "experts" when it comes to investing and it is unlikely that you will ever talk to anyone that has a guaranteed path to success (that's legal). Most people's advice may have worked for them but that doesn't mean it will work for you, after all in 2007 there were countless people who would give the advice "Take out as large of a loan as you can get and buy a home, fix it up and flip it." as being a great strategy to financial independence; and many of these people are bankrupt today as a result of their strategy.

At the same time I have seen a few articles that discussed how investing encourages people to act irrationally. When you typically look to purchase something the price being reduced increases your interest while if the price increased it would reduce your interest in the product; with investing the opposite tends to happen. What this means is that most people are most interested in an investment when it is the worst time to buy in and least interested when it is the best time to buy. This is not meant as investment advice because there is far more to investing than simply the price of the investment but ... If you look at interest in Apple and Research In Motion as an investment you can see this principle at play; because Apple's stock has seen dramatic increases for years people see it as having dramatic room for further increases, while Research in Motion's falling price means that people see no future growth prospects, while (in most similar cases) the opposite is the reality. Basically, it is more likely that Apple's stock will stagnate and/or decline because they're worth about as much as they realistically can be while Research In Motion's stock can rise quite dramatically and the company will still be worth a fraction of what they once were.

The reason I bring this up is that most of the people you trust will be acting irrationally when they invest and their advice to you on what to invest in can (often) be no different from someone recruiting you to join their pyramid scheme.

Gilgamesh, listen to HappySqurriel. Time and time again he's proved he is the smartest person on VGC. And he's a humble character.