By Carl Heintz
What follows may be shocking, but it is true.
- The market is “rigged” for small traders. The big boys have insider information and trade on it all the time. Ok, maybe not insider information like the SEC defines it, but if you rub shoulders with people on a daily basis, you pick up things that allow you to do things that strangers may not be aware of. The stock markets are cozy little markets.
- Most of the trading is done by computers, following algorithms. Yes, you as an individual are competing with an AI driven machine.
- Most financial statements by public companies are not accurate. Ok, maybe they “fairly present” the results of operations, but there is a tremendous amount of “massaging” of the data that goes on behind the scenes. Some of it falls within the legal, some of it borders on unethical.
- A small investor cannot compete with big investors on a short time frame. If you are clever, do your research, you can do well, but it takes a lot of time and effort, skepticism and insight. Daytraders are gamblers and typically have the same results as those who frequent the casinos.
- Stock brokers, financial advisors, financial planners and the like are for the most part sales people. Beware.