Expect to Be Wrong in the Stock Market
Editor's note: This is the beginning of a special collection of previously published investing lessons from RealMoney contributor and market strategist Barry Ritholtz.
In the present-day realm of investing, the near obsessive focus on stock selection has obscured the "art" of investing. There is much, much more to buying and selling stocks than mere stock picking. Not that you could tell, based upon what's in the financial media.
This new column -- "The Apprenticed Investor" -- is all about making you a better investor. Not just a better stock picker, but someone who knows how to preserve capital and manage risk.
One of the keys to successful investing is recognizing the frequency of "strikeouts" -- and having a plan in place to deal with them. This is the first lesson most new investors fail to digest.
Apprenticed Investor: Expect to Be Wrong in the Stock Market
Coming Up NextOver the next few weeks, we will review the traps, pitfalls and common errors that befall all too many investors. We will disassemble the damaging myths that keep haunting individuals. My list of investing "pet peeves" will get some airtime. We will dissect the reasons why stocks go up and down; it's actually simpler than most people realize. We will look at the debate over the "fundamental vs. technical analysis " issue. But it's not simply abstract theory: We'll go over "sell signals and stop-losses " -- a very basic yet overlooked tool. We'll look at "long-term" investing -- is it dead? Was it ever really alive? The answer will surprise you.
Select the service that is right for you!COMPARE ALL SERVICES
Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.
- Real Money + Doug Kass Plus 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV