Beware of advice offered over cocktails.
By Debra Phillips
Die-hard "Seinfeld" fans may recall an early episode in which perennial underachiever George Costanza gives comedian Jerry Seinfeld a "hot" stock tip. With reservations, Seinfeld invests in the stock and watches with horror as its value plummets. The moral of the story? Unsolicited advice is unlikely to leave you laughing all the way to the bank.
Nowhere, perhaps, is the potential for bad advice more prevalent than at that most elbow-rubbing of gatherings--the cocktail party. "Cocktail parties make people more vocal about `I'm doing great; I don't have any down stocks,' " observes Chris Flanagan, senior vice president of Boston-based Mellon Private Asset Management. "It might make somebody who's on the listening end of this more courageous."
You might get other types of advice--say, tips on where to open a second location of your business. But given a healthy economy and a nationwide fixation on the stock market, it's clear that investment leads set the most tongues a-wagging.
So . . . want a hot tip on how to deal with all those Warren Buffett wanna-bes? Always keep this in mind, says Flanagan: "Your investment objectives aren't necessarily the same as those of the person giving advice." What's more, think twice before opening your mouth.