Smart Money
Smart money is the amount of capital invested and controlled by experienced, well informed, and managed financial institutions such as institutional investors, asset management companies (AMCs), banks, financial institutions, investment banks, funds, and other financial professionals.
These big-time market participants have a fuller understanding of the market, all the resources, data, and tools to analyze with information that an amateur investor cannot access. Smart money also refers to the force of big money that can move the market. They can visit the company’s headquarters and pay for expensive research.
Dumb Money
Dumb money refers to capital invested by amateurs. These people don’t have any research behind picking stocks, they buy or sell stocks for the thrill of investment.
Remember dumb money not necessarily mean retail investors. It can include anyone who buys or sell stocks with no research.
