Don’t confuse these things. It’s very easy to look backwards and say “wow, NVIDIA really went up a lot”. But that is NOT the same thing as knowing that NVIDIA will go up a lot in the future. Lots of influencers, content creators, analysts, speculators, etc like to SAY they know what will happen in the future. It’s a really enticing pitch. “Hey, this stock is the next Amazon” or “The AI revolution is coming so invest in this stock.” But I can’t stress this enough: These speculators absolutely do not know what is coming next. No one knows the future. Study after study after study confirm that stock pickers are no better than random at picking stocks that will outperform the market going forward.

So what do you do? Instead of playing the guessing game, you can guarantee your own victory by buying ALL the stocks. If you own ALL the companies, you’ll collect the benefit of their growth, innovation, and profits. All the short term volatility we hear about is just noise introduced by short term speculators. That’s why those who want to build serious wealth over their careers should be buying and holding index funds, not guessing at picking stocks.

On a different note, if you’re one of my caption readers and you’re bummed about the recent election, I have a few thoughts. First, as I’ve always said, which party sits in the white house historically has nearly zero impact on what happens in the stock market. I’ll be buying and holding index funds through this administration and all the rest to come. Also, remember that progress is often two steps forward, one step back. This isn’t the end, it’s just a moment in time. Finally, in our modern digital world we all tend to find ourselves in echo chambers. Different groups of people are operating on completely different sets of information. But I do believe almost everyone is trying to do what they think is right. I believe most people are good. I hope the moral arc of the universe will continue to bend toward justice. I’m rooting for America as always.

As always, reminding you to build wealth by following the two PFC rules: 1.) Live below your means and 2.) Invest early and often.

-Jeremy

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By: Gabriela Gonzalez
Title: Why no one can predict which stocks will go up
Sourced From: www.personalfinanceclub.com/why-no-one-can-predict-which-stocks-will-go-up/
Published Date: Tue, 12 Nov 2024 22:19:59 +0000

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