Question

In: Accounting

Hi Max. The availability of information is certainly an issue. When we contrast pre-internet times with...

Hi Max. The availability of information is certainly an issue. When we contrast pre-internet times with post-internet times, we are basically looking at night and day in terms of information availability. Prior to the internet, if you wanted information on a specific company, you would have to contact their investor relations department and request information be sent to you. Now, everything is simply at our fingertips. Class, do you think that this may actually give some individuals a false sense of confidence in their own ability to invest and judge the market? Brandy

Solutions

Expert Solution

It is true that now the information is available on our fingertips. It is mandatory for a listed company to list its financials on its website so that any person can access the same and can get the information of the business of the company.

A knowledgeable person can easily predict the future of the company based on his studies of the financials. And based on the same, he can invest in the company and can earn decent profits. However, those who are not educated or who invests in the company without any study of its financials will generally tend to lose. So, having the information available online without any hassle has both pros and cons, knowledgeable people can earn profits while this may actually give some individuals a false sense of confidence in their own ability to invest and judge the market.

So, you must invest in any company only after proper study of the market and company because investment are subject to market risks.


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