Most investors research stocks like they choose a sandwich

Interesting article by Proinsias O'Mahony on how individual investors research stocks before purchasing. Includes the gem that "...the median investor devotes about six seconds to risk statistics."

I'd 100% agree with that analysis. I've lost count of the amount of people who tell me that they are just going to invest in a conglomerate like Berkshire Hathaway because it is just like a fund. Or they are just going to pick the top 10 companies in the MSCI World index. No consideration of price, earnings, PE ratio etc.

Steven Barrett said:

Or they are just going to pick the top 10 companies in the MSCI World index

Click to expand...

And that is the right strategy - other than making sure that they are not all in the same industry.

Investors, analysts & commentators are fooling themselves when they talk about price, earnings and P/E ratios - the market has already factored these into the share prices.