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With Investor Phil Town

InvestED: Ep. 204- Short-Termism

“Most of the time, the actions of fund managers are rational in the sense of protecting their jobs. They’re not rational when it comes to getting great long-term results. That’s why most fund managers never beat the market.” – Phil Town

In this episode, Danielle and Phil discuss why short term viewpoints in the stock market are terrible. When analysts upgrade or downgrade a stock and the price drops, it’s terrible. When companies miss on earnings and the market responds with stock price dips, it’s terrible.

Once you start having to hit a certain number every quarter rather than having to hit a certain number over the next five years, it becomes risky. What started as people wanting to get more information on company earnings has become a problem of short-term thinking.

Charlie Munger thinks that short-term investing is insane. He’s said in the past that he almost never has a transaction.

If you want to learn about how short-termism is hurting our market, join us on the podcast today!

Show Notes From This Episode

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On the InvestED podcast, Phil and his daughter Danielle shine a light on the successful investing strategies that gurus like Warren Buffett have used for 80 years. Listen in for a great stock market education on basics, learn how to invest on your own, and follow along with real-time examples and investing tips from week to week.