Investing Advice
Taken from an interview of Mark Cuban from Young Money Magazine.
YM: Do you have any general saving and investing advice for young people?
CUBAN: Put it in the bank. The idiots that tell you to put your money in the market because eventually it will go up need to tell you that because they are trying to sell you something. The stock market is probably the worst investment vehicle out there. If you won’t put your money in the bank, NEVER put your money in something where you don’t have an information advantage. Why invest your money in something because a broker told you to? If the broker had a clue, he/she wouldn’t be a broker, they would be on a beach somewhere.
Wow, and all this time I was wondering what stock should I buy, what mutual fund should I look into. Guess I need to start shoving money into the good old banking machine!
Cheers!
Well, you know how I feel about that…but he’s right about the imbalance of information. It IS possible to make money in the stock market, but it’s rough. And these days the turbulence of daytraders makes it much harder to value securities.
Cuban is a billionaire. I would take his advice somewhat seriously.
The question posed to him was centered around young people. I also would advice “young people” who are just beginning to develop their foundation, to focus on their savings. During your young years, you should first build up your savings to meet emergencies and by doing so, you are playing safe. Once, you have a sizeable savings, then direct money towards stocks and what not. The goal is to build your net worth through stable means. Then, and only then, would it be wise to take less stable ways to build your net worth.