25 Mar Which stocks will go up?
Photo: jppi/morguefile.comQ. So many stocks are down this year. How can I decide which ones will go back up?
— Investor
A. There is no stock market crystal ball.
You can’t reliably predict which stocks will go back up, so Jerry Lynch, a certified financial planner with JFL Total Wealth Management in Boonton, says you shouldn’t even try.
“Professional money managers can’t pick correctly all of the time, so with very limited time to do research, at best you are taking an educated guess,” Lynch said. “At worst you are through darts at a board.”
Lynch said when stocks go up or down, it’s often not related to how good a company is or isn’t.
For example, he said, it can be because you are in the wrong sector (oil), the wrong country (Greece), the wrong currency (Argentina), the wrong time (2008), or many other reasons.
“If professional money managers often can’t beat the index, what makes you feel that reading Money magazine will give you the knowledge to pick stocks?” he said. “Just buy the index and enjoy the ride.”
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This story was first posted in March 2016.
NJMoneyHelp.com presents certain general financial planning principles and advice, but should never be viewed as a substitute for obtaining advice from a personal professional advisor who understands your unique individual circumstances.