Your Keyword Here | Fake Tweet Causes $200 Billion to Be Lost Within 2 Minutes

Fake Tweet Causes $200 Billion to Be Lost Within 2 Minutes

Not too long ago computer hackers got into the Associated Press’ Twitter account and posted a fake about an attack to the White House and that President Obama was injured. With the attack on Boston merely a number of days before it’s no wonder the statement was considered seriously. However, within minutes the Associated Press announced the twitter comment was a fake and they had been hacked.

Within those few minutes however stocks sold of sharply, triggering the S&P 500 to sell of fast, if you look at charts from that day you can see clearly when the news hit. This sharp reaction caused a loss of nearly $200 billion in equity value.

This underscores 2 things;
One is the market is very volatile and is not the right place to bet your monthly income
The other thing it shows is the sharp drop was short lived.

There’s a chance you’re asking why is that important. When the stocks sold off people responded in panic, but as soon as the report turned out to be false investors became aware there wasn’t any underlying flaw in the belief concerning the stocks they owned.

It also shows what temporary and short term spikes in volatility can do “to” and “for” investors portfolios. If your accounts are passive, this means you buy a stock or mutual fund and hold in while checking in every great one, in a while you could potentially suffer the wrath of short term volatility and miss out on opportunities.

On the other hand, if your accounts have eyes on them and proactively managed, temporary and short term spikes in volatility can provide opportunities each and every day. Markets can make stocks and positions undervalued every single day. Traders over react to news and panic volatility can put positions up at a deep discount.

It’s a wise decision to have your accounts proactively managed by an exclusively devoted management group to be watching for these opportunities each and every day. An investment management team that manages money for large institutions and the day to day consumer gives them an added insight than the day trader broker up the street from your house. A specialized team can really tilt the odds in your portfolios favor.

Matt Golab
Chief Advisor of Aaron Matthews Financial Resources Click Here for Contact information for Matt.

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