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Lesko: Trying to Pick Winners Could Make You a Loser

By Fox 40 Staff.
Jason: Did the allure of day-trading go out with the 1990's? Greg Lesko of Lesko Financial says the desire to make "a killing" in the market persists.

Greg: Thanks, Jason. Like a bad habit, the dream of trading stocks to make a fortune resurfaces with each new generation. Adding fuel to this idea is the fact that the stock market has hit historic highs over the past few years.

Some people who were toddlers back in the bad old "Wolf of Wall Street" days may look at that era and think "why not me?" But the road to market riches is littered with the failures of those who thought they knew how and when to pick the winners.

All evidence to date comes to the same conclusion: the stock market is unpredictable and you can't time it.

Jason: But Wall Street gurus point to people like Warren Buffet who have gotten rich from stocks.

Greg: That only serves to grow the fantasy. Buffet is an investor, not a trader. He has grown his wealth through sound investment principles--which most people who are itching to trade find boring. Define your financial goals, put money into a diversified mix of investments to reach those goals; ignore the market's ups and downs, and stay the course over the long term.

Jason: So you'd advise caution for anyone who claims to have a sure-fire trading "system?"

Greg: When Buffet himself was asked how long to keep a stock before selling it his answer was: forever. Trading stocks--buying and selling them quickly--may seem exciting, but it's actually like gambling or buying a lottery ticket. It's a proven way to lose money.