Wednesday, August 01, 2012

In Picking Facebook Shares, Repeating the Mistakes of the Past - NYTimes.com

Excerpt from a timely individual investor reality check
"Instead, Facebook was a massacre for retail investors, highlighting yet again why stock picking is a loser’s game. The hype around Facebook was enormous as retail investors salivated at the chance to buy what they hoped would be the next Apple. Yet, after initially trading above $40 a share, the stock is now down nearly 43 percent from the initial offering price.
The Facebook example is one more confirmation of studies that have shown that, on average, individual investors lose out consistently when they buy and trade individual stocks. They’re better off investing in passive index funds."
In Picking Facebook Shares, Repeating the Mistakes of the Past - NYTimes.com
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