John Shinal’s Tech Investor
http://articles.marketwatch.com/2012-07-13/commentary/32649962_1_astrologers-ching-readers
Commentary: At least you won’t be misled by money managers
SAN FRANCISCO (MarketWatch) — Are you tired of getting bad advice from stockbrokers or financial advisers? Then maybe it’s time to turn to something more esoteric for investment advice.
One unusual alternative was put forth this week via an email I received, from a reader of my column on Microsoft Corp.’s (US:MSFT) busted aQuantive acquisition. Read “Microsoft’s cautionary tale.”
The reader claimed that Chief Executive Steve Ballmer’s strategic missteps were predicted more than a decade ago by what he said was a reliable source: the ancient Chinese oracle system, the I Ching.
Let me first say that I’m always cautious before engaging with readers who email me, instead of posting their views in the comments section. The anonymity provided by email tends to bring out the most extreme views and language.
More moderate readers usually aren’t afraid to keep the conversation out in the open. Public comments also provide information to other readers, who consistently supplement, challenge or push forward arguments I make in these columns.
Given my preference for open discussion, I might have dismissed the email after reading it (and yes, I do read every one, even the ones laced with profanity, insults and threats). However, this particular email brought to mind a story from my early days in journalism.
When I was a business writer at the San Antonio Express-News in the mid-1990s, my editor once handed me an odd assignment. In the middle of an October stock-market plunge, she wanted me to call several astrologers and ask them this question: Why do most of the largest market gyrations happen during the 10th month?
The process of reporting that story was enlightening, to say the least.
One thing I learned was that financial astrology is a large enough field to nurture several subspecialties. For example, one veteran stargazer informed me that he wouldn’t be able to help me explain stock drops because he dealt only with decisions on fixed-income securities.
But the astrologer who provided the kicker for that story was the one who challenged the very notion of October as a brutal month for the markets. “October is only a bad month if you’re selling,” this person told me.
It was a reminder that there are two sides to every trade, and that paper gains and losses become real only when you close out a position. In other words, market success often has as much to do with timing and nerve as it does with the quality of the advice you’re getting.
The same is true of Microsoft. Whether anyone made money on its stock during Ballmer’s tenure as CEO depends as much as anything to do with when they bought and sold.
After looking through the email touting the evidence of the I Ching’s prowess as an investment tool, I can’t say I’m convinced.
