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Information Amid Noise

Below are four snapshots I took on my phone yesterday during my morning train commute. These images from the CNBC app were taken within seconds of each other:

Notice any sort of pattern here?

There is no word the financial media likes to insert into headlines more than amid. Words like this are used for one purpose and one purpose only – to ascribe a reason or an explanation for some short term market movement. They subtly imply causation from correlation without outright saying it. I don’t blame the networks and publications for regurgitating this stuff every day – they know it’s total B.S. just as much as we do! Their obligation to their viewers advertisers is not to provide nuance but to create an aura of certainty and to scratch the perennial itch we all have to know *why* something is happening.

Amid is not the only tool in their arsenal – there’s also after, following, as and on – but amid is the go-to. By definition, it means to be surrounded by or in the middle of something. And that’s exactly how it’s used, right in the middle of some fleeting financial data point and some coincident news story that may or may not be tangentially related to said data point.

Nothing I say or write here will change this practice, so the only suggestion I’ll make to these media outlets is to start using the word in the context of things that actually matters to investors. Here are a few headlines I wouldn’t mind scrolling through the next time I open one of my financial news apps:

Interest rates fluctuated today amid conflicting goals and objectives of individuals, institutions, governments and central banks across the globe.

Stocks fell yesterday amid more sellers showing up than buyers.

Diversification does wonders over the long-term amid being an endless source of frustration in the short-term.

Value tends to outperform growth over time amid investors extrapolating to the upside and downside.

Value also occasionally underperforms growth over long stretches of time amid investors extrapolating to the upside and downside.

Commodities swing wildly amid supply and demand searching for an equilibrium.

The stock market rewards investors for bearing risk more often than not amid a relentless litany of uncertainty.

Understanding that narrative follows price and not the other way around is a critical step in becoming a successful investor. Don’t let yourself be fooled otherwise amid the myriad distractions out there.

About the author

Phil Huber, CFA, CFP®

Phil is the Head of Portfolio Solutions for Cliffwater, a leading alternative investment adviser and fund manager. Prior to joining Cliffwater in 2024, Phil was the Chief Investment Officer for Savant Wealth Management, a multi-billion dollar wealth management firm. Phil has been involved in the financial services industry since 2007. He earned a bachelor’s degree in finance from the Kelley School of Business at Indiana University. He is a member of the CFA Society of Chicago. More about me here. Twitter: @bpsandpieces

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