Anders Chelgren, Chapter 7, Question #4

People are often misinformed about the stock market. Many people think it is an opportunity to get rich quick, and while that is a possibility, it is highly unlikely. I loved Wheelan's analogy running commentary/comparison between people purchasing stocks and waiting in line at the grocery store. Just as any intelligent person would do some research before investing a large sum of money, people attempt to find the shortest line in a grocery store check out. It was interesting to me that he mentioned the fact that "everyone has access to the same information" this is true for both stocks and lines; If you see an obvious opportunity, most other people will too. One problem many people face in the stock market is failure to adapt a diverse, gradually increasing portfolio. People fail to maximize their utility. Often people buy because they believe they have some great knowledge that in reality, is not there. Just like the cheap selling house on Linkin Park, we are warned not to blindly trust brokers but to question everything. Some solutions proposed to the danger of investing is to take calculated risks, diversify stock options in different fields, and do not allow emotion to force you to act rashly. If American can save money frequently, invest it widely different fields with an understanding of risk/reward level than we should be financially better off. Following success, repetition would continue to grown investments and overall wealth.