(dramatic music)
Narrator: A lot of people talk about the market,
but what does that mean?
The financial market is made up
of millions of participants, many just like you.
Buyers and sellers who voluntarily agree
to trade shares of companies all over the world.
(soft ringing noise)
Every year millions of trades take place each day
totaling billions of dollars.
The collective knowledge of all
those participants is powerful.
Here's one example.
A group of people were asked how many jellybeans
were in a jar.
There were some guesses too high and some too low,
but the average guess was remarkably close
to the actually number of jellybeans.
Together, we know more than we do alone.
(engine rumbling)
In the same way, think of the stock market
as a large information processing machine
that takes in all available information about a company.
All this information impacts the price of the stock.
No one can really know if that price is right,
but thanks to the market's processing power
we can treat the current price
as the best estimate of its actual value.
(mechanical noise)
Stock prices are like other prices.
They move up and down based on new information.
Market participants quickly respond and prices adjust.
So to get ahead you need to be able
to predict where prices are going, right?
Wrong.
How many times have you maneuvered
to stay in the fastest lane of traffic
only to find yourself at another standstill?
You added anxiety, risked getting into an accident,
and may or may not have gotten ahead.
In the same way, trying to anticipate
the movement of the financial market
adds anxiety and unnecessary risk.
The point is, when you try to predict the market
you are competing against the collective knowledge
of all those millions of buyers and sellers.
Instead, harness that collective knowledge
for your portfolio,
and invest with a firm that will put
the power of the market to work for you.
(car engine rumbling)
(upbeat music)