TradingTrading Psychology
The flood of information (information overload) is one of the three main problems that traders complain about.
The best traders have their solutions: they limit the amount of news to the necessary minimum. Too much and not – selected news gives not only a waste of time but also may suggest something that will have a negative impact on the position.
I am not saying that all analysts are wrong and usually have no idea what they are talking about, no. But widely available opinions from the media do not give you an advantage, do not replace your own research of the topic and building your own outlook.
It happens that traders listen to analysts and journalists just to know what the “street” thinks. And it happens that they trade contrary to what could be drawn from the opinions and news.
This is not at all an uncommon situation.
Because of the news cycles and the cycles in which traders operate, practically always the information the media have is far behind what traders have already received and analyzed.
I also once met a trader who told me that when he listens to analysts on TV he always wonders who and what they want to achieve by giving certain content to the media.
He said that he started doing that when he listened to tips many times and lost, because, for example, great data on companies and great prospects turned out to be an incentive for the “street” to buy a stock from “strong hands.” And then the expected increases didn’t happen, declines came. This went on for so long until he began to wonder why.
STAY IN THE KNOW
