QOTD: There is no Why

Some of the most brilliant people I’ve met are terrible investors because they’re constantly seeking out ways to explain why things happen the way they do in the markets. Even when you’re right about the way something transpires in the macro picture, you may come to the wrong conclusion about how the markets will react to that event.

When you’re constantly looking for a catalyst to explain every single move in the markets you start to see signals and correlations that just don’t exist. Most of the time we won’t know exactly why the markets moved a certain way until much later. Sometimes even with the benefit of perfect hindsight, investors still can’t agree on the specifics of the cause and effect. But to some the ‘why’ in the markets will always seem easy after the fact, so they keep searching for the answers.

Even if you know the Why, you still don’t know what will happen. And if you manage to somehow know the What, well you definitely can’t know the When. The good news is, knowing these things aren’t crucial for good investing. Conversely, searching for them in vain, with money on the line, can be highly detrimental.

 

This content, which contains security-related opinions and/or information, is provided for informational purposes only and should not be relied upon in any manner as professional advice, or an endorsement of any practices, products or services. There can be no guarantees or assurances that the views expressed here will be applicable for any particular facts or circumstances, and should not be relied upon in any manner. You should consult your own advisers as to legal, business, tax, and other related matters concerning any investment.

The commentary in this “post” (including any related blog, podcasts, videos, and social media) reflects the personal opinions, viewpoints, and analyses of the Ritholtz Wealth Management employees providing such comments, and should not be regarded the views of Ritholtz Wealth Management LLC. or its respective affiliates or as a description of advisory services provided by Ritholtz Wealth Management or performance returns of any Ritholtz Wealth Management Investments client.

References to any securities or digital assets, or performance data, are for illustrative purposes only and do not constitute an investment recommendation or offer to provide investment advisory services. Charts and graphs provided within are for informational purposes solely and should not be relied upon when making any investment decision. Past performance is not indicative of future results. The content speaks only as of the date indicated. Any projections, estimates, forecasts, targets, prospects, and/or opinions expressed in these materials are subject to change without notice and may differ or be contrary to opinions expressed by others.

Wealthcast Media, an affiliate of Ritholtz Wealth Management, receives payment from various entities for advertisements in affiliated podcasts, blogs and emails. Inclusion of such advertisements does not constitute or imply endorsement, sponsorship or recommendation thereof, or any affiliation therewith, by the Content Creator or by Ritholtz Wealth Management or any of its employees. Investments in securities involve the risk of loss. For additional advertisement disclaimers see here: https://www.ritholtzwealth.com/advertising-disclaimers

Please see disclosures here.

What's been said:

Discussions found on the web
  1. w88 commented on Sep 20

    … [Trackback]

    […] Find More here on that Topic: thereformedbroker.com/2015/06/30/qotd-there-is-no-why/ […]

  2. bitcoin evolution review commented on Sep 28

    … [Trackback]

    […] Find More Info here on that Topic: thereformedbroker.com/2015/06/30/qotd-there-is-no-why/ […]

  3. Is Bitcoin Loophole A Scam? commented on Sep 29

    … [Trackback]

    […] Info to that Topic: thereformedbroker.com/2015/06/30/qotd-there-is-no-why/ […]

  4. fun88 commented on Oct 13

    … [Trackback]

    […] Read More Information here on that Topic: thereformedbroker.com/2015/06/30/qotd-there-is-no-why/ […]

  5. these details commented on Oct 29

    … [Trackback]

    […] Find More to that Topic: thereformedbroker.com/2015/06/30/qotd-there-is-no-why/ […]

  6. td canada trust online commented on Nov 10

    … [Trackback]

    […] Read More to that Topic: thereformedbroker.com/2015/06/30/qotd-there-is-no-why/ […]

  7. omega replica commented on Nov 25

    … [Trackback]

    […] Find More on to that Topic: thereformedbroker.com/2015/06/30/qotd-there-is-no-why/ […]

  8. half wigs commented on Nov 28

    … [Trackback]

    […] Information to that Topic: thereformedbroker.com/2015/06/30/qotd-there-is-no-why/ […]