Armies of stock analysts look at stocks in markets all over the world, determined to uncover those that they can say are a “buy.” They’re the articulate people on CNBC or CNN, employed by the world’s biggest brokerages and investment banks, talking about stocks and markets. Or else they’re the quotable “experts” in the print media.
Back in December I wrote, “There’s an entire industry dedicated to telling you what stocks you should buy. The main job of thousands of stock analysts in Singapore and Hong Kong – not to mention London and New York and other financial centres around the world – is to tell investors what stocks are a ‘buy’.”
These people sound like they know what they’re talking about. The reality, though, is that very few of them do.
I used to be a stock analyst. I looked at stocks in half a dozen sectors ......