Trading Stocks

Carley and I were at a friend's house for dinner last night. She’s a successful physiotherapist. Her husband is a lawyer.

We were talking about work, even though we always try not to. I told her one of my pet peeves is when clients try to deviate from their investment or financial plan.

“A few clients called this month. They want to sell their existing global index funds and ‘give stock trading a try for a bit.’” I told her whenever I hear that, I say the same thing: “The odds aren’t even close to being in your favour. Almost all the time, and over a long enough time horizon, trading individual stocks is like flushing money down the toilet.”

She looked at me a bit puzzled and asked, “Then what do they need you for, Vince? They can just buy a global index fund themselves.”

“But they don’t. And now I’m stopping them from trading individual stocks.”

She laughed and told me she sees that in her work all the time too. “People see me because they’re in pain. I fix the pain and try my best to keep them out of pain going forward.”

We left it there, but then her husband sat down and asked, “What stocks do they want to trade anyway?” Carley’s body language was telling me I better change the subject.

“It doesn’t matter.” Then I changed the subject. Much to Carley’s relief.