Think about the last novel you read that included a dangerous quest. If it’s a fantasy like the Hobbit, there might be giant spiders, goblins, and dragons- but in the end, it’s worth it because of the unfathomable treasure and riches that await them. The thing is, when we’re talking about investing in single stocks, the chance that this perilous journey ends up with a happy ending is much less likely, but folks continue along in their quest. Why? Maybe it’s because of the sophisticated tools that we have at our fingertips, or because it’s more accessible than ever with apps like Robinhood where you can buy and sell for free, or maybe you just think you’re smarter than everyone else. And sure you’ve heard of individuals who have crushed it by investing with a company like Tesla, but we’re still not fans of this type of approach. So in this episode we tackle some of the most common arguments advocating for investing in single stocks, why we ultimately disagree, and how you should invest your money instead. Single stock investing is unnecessary and can often be problematic.

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One comment on “The Perils of Investing in Individual Stocks – Episode 497

  1. Sean G Apr 11, 2022

    I was listening to this episode(497)and one major thing kept popping up into my head. through my company I have an employee stock share program. and from our paycheck we get a 25%(I think) discount on the purchase of the company stock. I know this counts as investing on a single stock. but where do you think that would fall in risk? it just sits in my portfolio and I have not sold in years, luckily it’s been doing well. but I know the stock has to depreciate at least 25% before I begin losing money. I feel like that’s a good enough insurance that investing in that single stock is worth it.