Teach Me To Trade Like The Wall Street Pros? 

No Thanks

         by: Brendan Magee

The commercial I am listening to on the radio asks me how I would like to earn an extra $500, $1,000, to $1,5000 per month. I am asked to think about the difference that would make in my life. Having young kids and bills to pay, I could use it.

To earn the money though, I need to enroll in this company's on-line trading educational program, and this is where they lost me.

There are countless examples of brokerage houses and the media leading investors down the wrong path. Here is one from Fortune Magazine. 

By all accounts this is a reputable and trusted resource for investors to use in making their investment choices. Their year 2000 guide is going to help me "Retire Rich." They are kindly giving me the "Ten Stocks To Last The Decade." How nice would it be in year 2000 to know that at least for the decade my investments are in the right stocks?

So let's see how our portfolio would fare had we invested in Fortune's stocks. Over the first 27 months, our portfolio is down 62%, but let's not panic. We still have almost eight years to go in the decade and we are not short-term investors. So if we had held on for the remainder of the decade how did our portfolio do? We are down 47%!

The reality is that teaching me to trade like the pros is teaching me to gamble and speculate and the long-term expected rate of return of gambling is zero.  Rather than teach people how to gamble and speculate, investors would find it invaluable to learn how to avoid gambling and speculation.

Brendan Magee is the founder and president of Inevitable Wealth Coaching. With questions, comments, or suggestions e-mail brendan@coachgee.com or call 610-446-4322.