Devolution of a Trader: How to Write Stock Market News

It occurs to me that some readers out there might have a passion for the stock markets, but know in their heart of hearts that trading and investing are not for them. That doesn’t mean they don’t want to participate in the market action, all the same. But how? Normally, this blog is exclusively about helping traders evolve, but I’ll take this one detour into how a trader can DEvolve. Get ready, because just about anyone with dreams of participating in the stock markets can enter the exciting and dynamic field of: stock market reporting.

Stock Market Reporting
Stock Market reporters are like the Gym Teachers of the financial world. You know the saying “those who can’t do, teach?” Well, even if you can’t teach, you can still teach gym. It doesn’t even matter if you are an overweight chain smoker. For stock market reporters, it’s really the same deal, only you can’t make anyone run laps around anything.

“I sound perfect for that,” you might be thinking, “but, I don’t know anything about financial reporting.” Nonsense, pessimist! In just a few minutes you will know everything you need to know. There are really just two steps. Be careful, though, because step one is a two-parter…

Step 1: Prepare!
For this step, you need Yahoo! Finance and CNN.com.

Part A: Go to Yahoo! Finance. Look to the left. Do you see the “Market Overview”? (Hint: if you see your kitchen, you have looked too far… try to lock your eyes on-screen. Seasoned reporters can do this without even moving their heads.) Note whether the Dow arrow is a happy arrow (pointing up) or a sad arrow (pointing down).

Part B: Now, go to CNN.com. I can already hear some of you groaning. I know, there’s lots of words there, and it looks scary. But remember, you are a financial news reporter, so just read the top story’s headline (that’s the words that are bigger than the other words).

Step 2: Report!
If today has a happy arrow, then report: “Markets up on news of” + headline. If today has a sad arrow, then report: “Markets down on news of” + headline. Now, you are going to need several paragraphs below this line to establish that you are an insightful and credible reporter, but don’t panic! No one reads anything but the first line, so you can just talk about your favorite flavor of ice cream. Reporters new to the field will need to build up about fifteen of these paragraphs. Once you have a back catalogue, simply pick three at random every day and add them to today’s headline.

Once you are familiar with the basic story format, try to branch out like this: If you happened to notice that the number beside the happy or sad arrow wasn’t very big, you can choose to say “Traders still digesting news of” + headline.

Example: “Markets down on news of golden globes nominees announced.” You get the idea.

Advanced Technique: Historical Context
This technique is only for veteran financial news reporters. That is, you need to have been reporting for at least one day. If today’s arrow is different than yesterday’s arrow, you can provide your public with important historical context for the current market action. This is a way you can really distinguish yourself from the short-sighted competition. For instance, you could say: “Markets are up on news of a growing gerbil population in France, despite yesterday’s concerns over Shuttle Atlantis rolling to the launch pad.”

Pitfalls
Make sure that the headline you got in Step 1 was from a news story, and not an advertisement. You don’t want to report that the markets are up on news of a three day sale at Macy’s, beating analyst estimates of a two day sale.

If you are giving historical context, make sure today’s top story and yesterday’s top story are different. Otherwise, you’ll say the markets went up and down for the same reason. You could research today’s story, looking for any change that could explain the difference, but that’s a lot of work. Alternatively, you could switch from news story headlines to one of the news categories. These are vague enough that people reading will fill in the details on their own. For instance: Markets down on news of weather.

Variation: TV Analyst
Do you have receding clown hair and a propensity to yell and sweat profusely in front of a large audience? You may be qualified to appear on TV every day. Do you also like to decapitate toy animals and press shiny red buttons? Then you are definitely qualified to appear on TV every day. Congratulations. The added benefit of this path is that no one will care if your views are inconsistent from day to day.

Summary
This was just a bit of fun, but there’s a message in it… I suggest you don’t bother with Stock Market news. All they do is point to some event, and point to the market indices, and try to make you think they are correllated in some way. It gets even more comical when you read a service that updates a few times a day. They are reporting on a level that puts significance into market noise. It’s worse than misinformation, if you buy into it… traders should do their best to suppress the urge to attach meaning to noise. Market news just reinforces bad habits.