Ever wonder what investment pundits are really saying? We often see them on TV or read articles quoting gurus with such sage advice via clichés. As with many industries, investing has its own set of idioms, some informative and some meaningless. Below is a list of popular sayings with translations to help you decipher their true meaning.
- Only when the tide goes out do you discover who’s been swimming naked.
Translation: Anybody looks like a genius in a rising market. The true skill is evident during down markets.
- It’s different this time.
Translation: Some wild and crazy logic is about to be let loose.
- It’s time In the market, not Timing the market.
Translation: Staying invested is more fruitful than trying to time buys and sells based on ups and downs.
- Be fearful when others are greedy. Be greedy when others are fearful.
Translation: Be prepared to invest in a down market and to “get out” in a soaring market
- Usually from positions of authority, “We’re digging deeper.”
Translation: We don’t know what is going on
- Pigs get fat, hogs get slaughtered.
Translation: Don’t let greed get the best of you.
- Stocks Climb a Wall of Worry.
Translation: Stocks tend to rise when investors are anxious. Stocks top out when people become too optimistic.
- Buy the Rumor, Sell the News
Translation: Stocks often rise on chatter speculating about pending good news, such as a strong corporate profit announcement.
- Economists have predicted seven of the last three recessions
Translation: Doom sells. Economists are a gloomy lot. Don’t get too worried about the numerous commentators claiming the world is ending – it probably isn’t.
- “All the weak hands are getting shaken out” or “My thesis is still intact”
Translation: I’ve lost a lot of money on this, but I’m still right.
- Markets can remain irrational longer than you can remain solvent.
Translation: Just because an asset appears mis-priced, this doesn’t mean it is likely to quickly move back to an intrinsic valuation.
- The stock market is a device for transferring money from the impatient to the patient
Translation: A reminder that stock returns are best realized over the long-term.
Some of these are thought provoking while others are comical. I’ll let you choose which is which. I hope you have had a good week and staying safe.