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16-08-2023, 09:07 AM
If you are a fundamental investor you would rely on the statutory reports on the progress of the company. Unless it is a case of fraud, most of the reports can be relied on. In a sense there are no fake news if you rely on the statutory reports.
Unfortunately if you are a trader with investment horizon of days or weeks you seldom pay attention to such statutory reports. This is because you are looking at crowd behaviour to drive stock prices.
The crowd will of course listen to news, rumours, and maybe statuary reports once in a while. Can the crowd differentiate between fake and real news? I am not sure.
More importantly does the crowd need to differentiate since it is relying on sentiments rather than fact? So if you are a trader you should embrace all sorts of news as they can help you understand the market sentiments.
If you are treating your investments as if you are buying and selling pieces of paper, the question of fake news is not relevant. But if you are a fundamental investor, don't stray from the statutory reports if you want to avoid fake news.
Unfortunately if you are a trader with investment horizon of days or weeks you seldom pay attention to such statutory reports. This is because you are looking at crowd behaviour to drive stock prices.
The crowd will of course listen to news, rumours, and maybe statuary reports once in a while. Can the crowd differentiate between fake and real news? I am not sure.
More importantly does the crowd need to differentiate since it is relying on sentiments rather than fact? So if you are a trader you should embrace all sorts of news as they can help you understand the market sentiments.
If you are treating your investments as if you are buying and selling pieces of paper, the question of fake news is not relevant. But if you are a fundamental investor, don't stray from the statutory reports if you want to avoid fake news.