I’ve heard it said that you just can’t fix stupid, and while I certainly agree with that assessment, it still blows my mind how highly intelligent people can still say the dumbest things when it comes to the stock market. It’s true; even people with above average IQs and a PhD have still said the following items on the list below. While I highly doubt any of MY readers would say any of the following statements, you will now have intelligent comebacks in case someone else makes silly remarks when it comes to investing. Go show them how it’s done!

1. “I made ($X,000) in the stock market today.”

My follow-up question of course is, did you sell the stock(s)? Nine times out of ten they didn’t sell that day and just let the market close out the day on a positive note. In other words, they didn’t make any money at all. You could be ahead in a poker game or in roulette, but until you cash out, you didn’t really win anything. This is a classic example of counting your chickens before they hatch. What they should say INSTEAD: “A stock(s) in my portfolio gained $X,000 today, but I have reason to believe that it’s headed higher in the long term so I decided to hold”. 

2. “Of course my portfolio is diversified; I own mutual funds that track the major indexes.”

You can diversify WITH mutual funds that track the major indexes, but on their own, they only represent one kind of security. One typically uses index funds as a way to put extra cash to work in a portfolio while you wait to buy something else. The returns are meant to be relatively stable over time, however the returns are never really anything impressive.What they should say INSTEAD: “I diversified my portfolio with some index mutual funds but I know I shouldn’t stop there. Instead I’m looking to buy a few stocks in each sector to ensure that I’m really diversified”. 

3. “I have a new broker who guarantees that I’ll beat the market!”