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Keeping It Simple Isn't Stupid

Consider these three things before buying a stock.

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Seventeenth-century French philosopher Blaise Pascal once said, "All man’s miseries derive from not being able to sit quietly in a room alone." I can't think of better words to describe investing.

As I write this, the S&P 500 index stands at around 900, the same level as in July 1997. That means most investors' portfolios have gone nowhere, on average, over the past five years. Sure, there have been moments of euphoria and, lately, despair. But on average, an investor who stuffed his or her money under a mattress and "sat quietly in a room" for the past five years would have been no worse off than those of us who scrutinize every nook and cranny of the stock market.

Times like this remind me just how simple stock investing is. When the talking heads start to blather on about sector rotation, unemployment numbers, technical indicators, the falling U.S. dollar, or the direction of interest rates, do yourself a favor and hit the "mute" button. These things are just noise.

Mark Sellers does not own (actual or beneficial) shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.