Reading some of the posts and rationale on here explain to me why people stink at stock picking; they have trouble grasping the sum of the parts and rely on individual metrics that don’t fully explain what’s going on with a company. The same people that preach efficient market theory will turn around and say how overvalued something is. People will call stocks speculative tech garbage because it trades at a premium because they only look at price to earnings but when you discount that to their future earnings potential based on historical growth they are fair value. Some don’t understand the concept of sentiment and how that is probably the most important factor in deciding how a company will perform near term. You could find one negative metric about any company, including blue chips, and make an argument for why it could be a bad investment based on any chosen data point. Also, common sense pays a role. Of course some metrics obviously hold more weight than others, but if you look at a company holistically instead of at individual data points you can do well.
Edit: this post was meant for people who are new to picking stocks. The amount of bogleheads who came out in full force attacking me for simply pointing out that one should look at a company holistically tells you everything you need to know. I never claimed to be a stock picking god. They are exactly what they claim I am: insecure and think they are smarter than everyone else. You know they’re insecure when they feel so threatened by a post about stock picking and they condescend anyone who thinks they can do better than a broad based etf. Never have I felt the need to attack any of the 98% of “buy a broad based market etf” posts I’ve seen on here. This community is called “stocks” so forgive me for thinking speaking about stocks was acceptable. My intention was to help people who are new to investing to know that things like PE aren’t the only thing that’s important to value a company, something I wish I knew when I started out. To everyone who is so lame that they had nothing better to do than hate because they can’t stand the thought of buying individual stocks; go back into your wife’s boyfriend’s basement that you crawled out of.
