dumb money

Inexperienced market participants

Dumb money is capital invested by inexperienced or uninformed investors, as opposed to institutional or professional traders.

The term implies these investors follow trends, buy high, sell low, and generally make poor timing decisions: When dumb money starts piling into a stock, smart money gets out.

Wall Street uses it dismissively, though the "smart money" doesn't always outperform.

Related

herd mentality · GameStop · diamond hands · paper hands · bag holders · confirmation bias · retail investors · meme stocks · FOMO

Categories
Opposites
investment sophistication

dumb moneysmart money

Capital from informed sources

institutional investors · hedge funds · Wall Street · private equity · market makers

market influence and power

dumb moneysmart money

Capital from informed sources

big money · kingmakers · deep pockets · old money

investment timing and behavior

dumb moneysmart money

Capital from informed sources

value investors · first movers

Family

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Top 500,000
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Abstract · Negative · Rated PG