Noise Trader

Let’s play a new game: Are You a Noise Trader?

Do you make trading decisions based on whatever you last saw on YouTube? Do you consider a 20-sided die to be your best form of financial research? Do you think the term "EPS" refers to a form of psychic power?

If you answered "yes" to any of those questions, then you might be a noise trader.

Fundamentally, the term "noise trader" refers to dopes who move money around seemingly at random. Noise traders don't base their decisions on a lot of rigor or analysis. They just bounce around with market trends (adding to the market noise, as it were), waiting until they get caught up in an otherwise avoidable downturn. When they lose so much money, they have to quit their day-trading dream and go back to being a dentist or whatever.