Giving financial advice to friends and family is very dangerous business. I never give "tips" to people who are actively looking to get rich. But I will sometimes give general guidance when I feel a responsibility to an individual I'm close to, especially if they are clearly on the wrong track. But I even prefer to avoid this whenever possible. Just as a doctor does well to avoid treating close friends and family as patients, investors do well to avoid financial entanglements with people they are close to.
I tried to educate people around me for about 2 years then I gave up because it seemed like I wasn't making any progress. They also gave up on learning eventually, and became my clients. :)
Better to stay away for sure with friends or so ... from my experience:
1) you mention a business you like - stock goes down after 30%, then you are not good at your job lol ... if it goes up, they disappear and forget about the beer or they have as their own genius idea after they looked at 2 more news articles ;)) ... but those are outliers, most folks are okay actually, at least with my experience ... but always better to avoid 'downsides' be it actual or potential ones
2) Fun story: I did tell some folks once about MSCI World ... 1) some came 4 weeks later to complain that it was not the cheapest ETF with 0.14% as there is another one cheaper at 0.1% but one that launched right after I mentioned 'my ETF' 2) it dropped also in 2020 and whenever we have issues, then some say but bro' that is risky 3) some I told this 10-15 years ago, they invite me for free holidays at their places each year :) ...
Glad to hear, welcome ... so yeah, even MSCI World can be problematic :)) ... but hey, most folks are fine, let's have a positive bias, not a negative one :)
"5. The outcome of anything you advise them to do will be attributed to you."
Not true. If your advice turns out great, it will magically turn into their idea.
You really can't go wrong advising people to buy an S&P index fund.
One thing that's nice about algorithmic trading and being a quant is that people who don't have computer science and trading backgrounds don't automatically assume they can do what you can do.
The problem with buying individual stocks is that people assume that because they can open a Robinhood account and place a buy order, they can do what you can do, as they believe you are just doing the same thing.
Giving financial advice to friends and family is very dangerous business. I never give "tips" to people who are actively looking to get rich. But I will sometimes give general guidance when I feel a responsibility to an individual I'm close to, especially if they are clearly on the wrong track. But I even prefer to avoid this whenever possible. Just as a doctor does well to avoid treating close friends and family as patients, investors do well to avoid financial entanglements with people they are close to.
This is basically identical to my feelings on the matter.
Massive understatement that you are better than the average investor 🦉💪
You flatter me, haha.
You know I'm fair, mate!
I tried to educate people around me for about 2 years then I gave up because it seemed like I wasn't making any progress. They also gave up on learning eventually, and became my clients. :)
An advisor-client relationship is much better, more procedure and process involved with regular structured meetings.
Great take Conor, thank you!
Better to stay away for sure with friends or so ... from my experience:
1) you mention a business you like - stock goes down after 30%, then you are not good at your job lol ... if it goes up, they disappear and forget about the beer or they have as their own genius idea after they looked at 2 more news articles ;)) ... but those are outliers, most folks are okay actually, at least with my experience ... but always better to avoid 'downsides' be it actual or potential ones
2) Fun story: I did tell some folks once about MSCI World ... 1) some came 4 weeks later to complain that it was not the cheapest ETF with 0.14% as there is another one cheaper at 0.1% but one that launched right after I mentioned 'my ETF' 2) it dropped also in 2020 and whenever we have issues, then some say but bro' that is risky 3) some I told this 10-15 years ago, they invite me for free holidays at their places each year :) ...
Hahah great anecdote Mav, thanks for reading and sharing your take.
Glad to hear, welcome ... so yeah, even MSCI World can be problematic :)) ... but hey, most folks are fine, let's have a positive bias, not a negative one :)
"5. The outcome of anything you advise them to do will be attributed to you."
Not true. If your advice turns out great, it will magically turn into their idea.
You really can't go wrong advising people to buy an S&P index fund.
One thing that's nice about algorithmic trading and being a quant is that people who don't have computer science and trading backgrounds don't automatically assume they can do what you can do.
The problem with buying individual stocks is that people assume that because they can open a Robinhood account and place a buy order, they can do what you can do, as they believe you are just doing the same thing.
Haha, that's a good point re: it becoming "their idea". Touche.