What's your "go-to" source for financial information?
"Family and friends" is the #1 answer given in the annual Retirement Confidence Survey. But a close second is search engines and other online tools, including online forums like the one that rose to notoriety in the past few weeks.1
As the "short squeeze" story is unfolding, it appears that individual investors played a smaller role than initially believed. Wall Street institutions were very active in those short-sell situations, and their trading may have been the main driver behind the volatile price swings.2
Regulators are digging into the activity, but some firms have concluded it was a battle between Goliath vs. Goliath, while David merely provided a narrative that captured the nation for several days.2
The Retirement Confidence Survey found that financial professionals are becoming a more critical source of information on retirement strategies. Many financial professionals have passed exams administered by The Financial Industry Regulatory Authority and are required to take continuing education courses to maintain their licenses.3
Some of the ongoing training focuses on regulatory, compliance, ethical and other practice standards.3
So the next time you consider following a hot tip or hopping into an online forum, take a minute and consider your investment strategy's goals. Pause and question if the investment idea or strategy conforms with your objectives and whether the risks involved are within your tolerance. If not, be prepared to pass or to lose your money.
But if you still get excited about an idea, please contact us. We'd welcome the chance to hear your thoughts.
1. Employee Benefit Research Institute, 2020 Retirement Confidence Survey
2. CNBC.com, February 5, 2021
3. FINRA.org, 2021
In order to sell short, you are required to open a margin account. Selling a security short involves greater risk, including the risk of unlimited losses in a position. Selling short is not suitable for all investors. Margin trading entails greater risk, including, but not limited to, risk of loss and incurrence of margin interest debt. Please assess your financial circumstances and risk tolerance before trading on margin.
Investing involves risks, and investment decisions should be based on your own goals, time horizon and tolerance for risk. The return and principal value of investments will fluctuate as market conditions change. When sold, investments may be worth more or less than their original cost.
The content is developed from sources believed to be providing accurate information. The information in this material is not intended as tax or legal advice. Please consult legal or tax professionals for specific information regarding your individual situation. This material was developed and produced by FMG Suite to provide information on a topic that may be of interest. FMG Suite, LLC, is not affiliated with VANCO Financial Group. The opinions expressed and material provided should not be considered a solicitation for the purchase or sale of any security.
It Was Goliath vs. Goliath All Along
February 18, 2021