When I teach and mentor people how to buy and sell stocks and ETF's, the learnings revolve around understanding what makes stock prices go up and down. I teach people how to read and interpret financial statements, assess risk, valuation, developing an investment decision framework, learning and managing our emotions. These are core pillars to framing an investment decision. There is also one other very important factor that can drive stock prices and for the most part we ignore it and take it often for granted. Given the events of the past few weeks, this factor has become has now entered the discussion.
Josh Brown of the Reformed Broker blog, wrote a fantastic piece called Stock Markets and the Rule of Law which reintroduces us...all of to the importance that the rule of law has in how business functions. In this episode I weigh with my own thoughts about this and how it has made take pause in how I am currently framing my own personal investment decisions.