Broker Check

The Media And Your Portfolio

October 30, 2021

“Stock-market investors should be ready for 10% fourth-quarter correction, says Stifel’s Bannister.”[1] 
-MarketWatch, October 21, 2021

“JPMorgan portfolio manager adds S&P 500 exposure.  Here’s why he’s bullish.” [2]
-MarketWatch, October 22, 2021


The quotes above are about one subject, from one news source, only one day apart.  The financial media can be confusing, and it certainly isn’t helpful in meeting your long-term goals.

If you watch an hour of business news, whether it’s CNBC, Fox Business, Bloomberg or any other TV source, you’ll likely experience a handful of “experts,” one talking about how a major market pullback is imminent, while the next talks about how the Bull Market is still young.  None of this is ever resolved, of course, because no one can consistently or accurately predict the short-term direction of markets.  The short-term direction of the market is unknowable.  It always has been.  Watching this unfold on TV can make you anxious, which is not good for investment decisions.  This is true for print media, too.

The main reason I advise clients to avoid financial TV media is because they don’t know you or your specific situation.  When that “expert” appears on TV with advice, he has no idea when you’re planning to retire, how much money you make, your investment knowledge and tolerance for volatility, whether you have children, what kind of retirement plan you’re enrolled in, or anything else about you.  He’s simply filling air time.

Consider what motivates the financial media business.  They’re not in the news business.  They’re not even in the entertainment business.  They’re in the ad-selling business.  They get paid in ad dollars, not by whether you benefit from their advice.

The media benefits more if you tune in longer, not if you succeed.  The more viewers tune in, the more ad revenue they receive.  That’s why they tell you the sky is falling.  Bad news sells, while good news doesn’t.  Let’s face it, most people only watch The Weather Channel for long stretches when a storm is approaching.  If you tune in and they say it’s going to be a sunny and calm day, you will tune right out.  Ad dollars gone!

Keep in mind that the best thing to do to work toward your long-term goals is to have a plan and stay with it.  Financial media is fine if you view it as entertainment, or even as information, but I advise against using it to make important decisions.  Talk to your advisor about important decisions so you can decide together what is right for your specific situation.

You’re better off going for a nice walk than watching the news.  It’s better for your health!

As always, please feel free to contact me with any questions.




The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual.