Impact Advisors Group | Duxbury Massachusetts | Warrington Pennsylvania

What Role Does the Financial Media Play in Investing?

Bad things tend to happen to your personal wealth if you read, watch or listen to too much news, or if you read too much into the news you are reading. It is human nature to react to the onslaught of information with fits of fear, excitement or confusion. This, in turn, can lead to counterproductive, buy high/sell low investing.

Often, the media is partially to blame for this. They know what attracts our attention, and that is why they rarely cater to the sensible investor. Many members of the press choose to pander to our junk-news cravings, and prioritize their own profits over a commitment to their craft.

But that brings us to an important question: Who is “the media”? We are happy to report that not every member of the financial press is cut from the same, self-serving cloth described above. There are those who could get away with manipulating us, but they choose not to. By understanding the difference, you may find it easier to identify who within the financial press is worth following, and who you would be best advised to “unlike.”

Whether it is in print, on air or online, we would suggest there are three broad types of financial news to assimilate into the choices you make as an investor:

1. Market Reports: From current stock prices to breaking local, regional and global events, there is never a lack of raw, market-impacting information flooding media outlets around the clock and across the world.

2. Market Commentary: Accompanying the deluge of data points, there is also a torrent of commentators who are eager to share their own and others’ analyses of the latest news.

3. Financial Columnists: Many media outlets also hire personal financial columnists to publish deeper, more thoughtful reflections on topics of interest to investors.

None of these categories is inherently good or bad. For example, a regular flow of publicly available information and analyses creates more transparent market price-setting. In this role, a steady stream of mixed-bag news and views leads to more efficient trading for all. That is good news for investors of every stripe.

The trouble begins when you assume this same outpouring of information can help you predict future pricing for your own trading activities. Despite all the opinions and play-by-play predictions, nobody actually knows which combinations of news will cause what stocks or markets to rise or fall, or at what points in time. This means, nobody can provide you with actionable, trade-worthy insights that will enhance an already well-built portfolio, allocated and balanced according to your personal financial goals. Anyone claiming otherwise is setting you up to betray your own best financial interests.

But what about those personal financial columnists who seek to step above the fray and cover the broader beat? Can they add value to your investment experience?

You will find subtypes within this category as well, with some columnists mixing and matching one or more of the following roles within their work:

1. Watchdogs: Some financial journalists serve as the media’s traditional “fourth estate,” seeking to hold governments, businesses and individuals accountable for their deeds.

2. Advice Columnists: Some are more like the Ann Landers of the financial beat, responding to readers’ queries about finance and investing.

3. Outside Influencers: Still others have primary careers outside of the media, contributing their perspective as real or perceived subject matter experts in their profession.

Again, there is no right or wrong kind of personal financial columnist. A dutiful watchdog can uncover real problems that deserve to be exposed. A self-serving reporter may be more interested in creating tempests in a teapot, hoping to further their own career. Advice columnists can offer objective advice, or they can perpetuate misguided myths. Some outside influencers provide well-informed insights within their specialized fields. Others spew out self-dealing sales pitches in disguise.

In short, among the financial press, you will find an ocean of noise, islands of common sense and rare voices of reason that rise clearly above the din. In our next piece, we will look at some of the personal financial columnists who have stood out as advocates for their readers’ best interests, while elevating the conversations taking place between investors and the financial press. 


With all the uncertainty and volatility in today’s economy, the time is now to take a thorough look at your finances. To accurately plan for your financial future, you must first know where you currently stand. For these reasons, our Success Team at Impact Advisors Group is offering a free financial assessment for both individuals and business owners. Request yours today!

This post was prepared and first distributed by Wendy J. Cook.

Impact Advisors Group LLC (“[IAG]”) is a registered investment advisor offering advisory services in the State of Massachusetts and in other jurisdictions where exempted. Registration does not imply a certain level of skill or training. The information on this site is not intended as tax, accounting or legal advice, as an offer or solicitation of an offer to buy or sell, or as an endorsement of any company, security, fund, or other securities or non-securities offering. This information should not be relied upon as the sole factor in an investment making decision. Past performance is no indication of future results. Investment in securities involves significant risk and has the potential for partial or complete loss of funds invested. It should not be assumed that any recommendations made will be profitable or equal any performance noted on this site. The information on this site is provided “AS IS” and without warranties of any kind either express or implied. To the fullest extent permissible pursuant to applicable laws, Impact Advisors Group disclaims all warranties, express or implied, including, but not limited to, implied warranties of merchantability, non-infringement, and suitability for a particular purpose. IAG does not warrant that the information on this site will be free from error. Your use of the information is at your sole risk. Under no circumstances shall IAG be liable for any direct, indirect, special or consequential damages that result from the use of, or the inability to use, the information provided on this site, even if IAG or a IAG authorized representative has been advised of the possibility of such damages. Information contained on this site should not be considered a solicitation to buy, an offer to sell, or a recommendation of any security in any jurisdiction where such offer, solicitation, or recommendation would be unlawful or unauthorized.
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