In case you missed it, here’s my list for 2015’s worst commercials geared toward the average investor.
They waited until December, but boy did Interactive Brokers save a doozy of a terrible commercial for us. I think it deserves consideration as 2015’s worst. Check it out:
Where do I start??
First, they’re going for the “sophisticated” angle. By having our traders eating late at a fancy restaurant we can only conclude they must be very rich and have access to those super elite financial tools, strategies and products only available to the wealthy. Interactive Brokers clearly wants the audience to see that they provide these tools.
Reality: prudent financial tools, strategies and products are the same for everyone, regardless of income or financial status! The most important strategies that truly affect returns (minimizing fees, diversifying, investing long-term) are available to everyone.
Second, it’s implied that because there is turmoil somewhere in the world, we must “trade” it! Gee, can you think of anyone that might profit from perpetuating the myth that actively trading around events – futile attempts at market timing – is a smart strategy? Might it be our friends at Interactive Brokers? I think so.
Reality: the less you act, the more you’ll earn. It’s been proven time and again. It’s simple: overconfidence leads to excessive trading.
Third, our active trader’s reaction to a down market is pitiful. Does she think that hedging her portfolio AFTER the market goes down will do anything other than extract commissions from her cash balance and inevitably cause her to lose any returns from a reversal? Her action is the equivalent of buying car insurance after a car accident. Read: a really stupid decision.
Reality: the only appropriate time to make a decision about (or hedge) your portfolio is when you aren’t stressed and susceptible to making an emotional mistake. Trading after hours, on a mobile app, at the dinner table certainly qualifies as a potential/probable emotional mistake in my book.
Bravo, Interactive Brokers. You made a really stupid commercial – one of the year’s worst.
12/10/15 Update: Interactive Brokers took down the original video and replaced the South American earthquake scenario with the video I’ve now linked to, which references Russia downing a NATO aircraft. Weird.