Amateurs shouldn't overanalyze

Legacy_user

The liquidity of stocks can be a bad thing, people are able to act rashly like they couldn't with property. Amateurs will always be too late to act and risk locking in losses and incurring commission depending on the investment.

Professionals can make a long term gain out of many short term gains but this isn't something amateurs can do well and I think most amateurs investing for the long term are better off turning off the news so they don't obsess and make rash sales

Redknapps_Dog

Yes, correct.

masonic

Yes, there are information asymmetries. Institutional investors are able to outmanoeuvre individuals and there have been studies that show the result is a systematic transfer of wealth from individual investors to institutions, e.g.

http://finance.martinsewell.com/traders/Barber-etal2005.pdf

There is a lot to be said for long term buy and hold strategies.

BananaRepublic

The answer is not to buy individuals shares, but collection investments such as unit trusts, OEICS and investments trusts, and hold for the long term since as you say, it's not easy to predict short term movements.

System

Definitely agree about funds + uts