We all get stock tips and we dont think twice before giving one or two ourselves too. This article now will probably end the visitors to this site :-) and the tip asking/giving on messageboards. You must remember that the tips/recommendations on this site should not be taken for granted.
From the famous turtletrader.com ( a must visit site - if you already haven't, go there now ! ). This is another and weird way of looking at the market. So the mantra is buy when its going up and sell when its going down. Simple isn't it ? So, enjoy the reading.
In the last few years the majority of the general public seems to have accepted online stock chat rooms as somehow useful. Some of the over-hyped chat boards and news services include:
Let us be blunt. Imagine you are at Motley Fool and you receive a stock tip. You now know it is time to buy whatever the tip is. Big problem here now. When do you sell? How much do you buy? Of course, the tipsters never try to answer these questions. Stock tips are kissing cousins to the ever-popular lottery tickets. They might feel good, but stock tips are for losers (just like lottery tickets).
For example, the stock market crash painfully proved the worthlessness of stock tips. No tip predicted the NASDAQ crash. How in the world could an opinion of some anonymous message poster, that only knows how to yell BUY, ever be useful?
Trend Following trading does not attempt to predict the market. We couldn’t care less what a company does or what its new economy potential might be. It does not matter what a company's business plan is or even whether they have a potential to make money. When you trade properly, your only concern is price. If the price is going up you buy. If it's going down you sell. Don’t waste your time trying to determine the potential of a company. And don’t waste your time looking for tips on chat boards. You will only lose money if you go down the stock tip path.
The comments section is open for some screaming ;-)