Navigate money 12
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Person 1: Am I having an exposure to individual stocks when I invest in ETFs?
Person 2: Yes, ETFs comprise of individual stocks. You are actually investing in hundreds of stocks when you invest in ETFs.
Person 1: Ok. But why are you not advising me to buy certain famous individual stocks in addition to these ETFs?
Person 2: The current market price of all individual stocks is already factored in the current demand and the future prospects of these stocks, taking all the public information in to consideration. So, almost always, stock picking does not work.
Person 1: Gee. I didn’t know that!
Person 2:
Person 1: Ok. But why are you not advising me to buy certain famous individual stocks in addition to these ETFs?
Person 2: The current market price of all individual stocks is already factored in the current demand and the future prospects of these stocks, taking all the public information in to consideration. So, almost always, stock picking does not work.
Person 1: Gee. I didn’t know that!