Investing is stressful, exciting and perilous all at the same time. If you’re dedicated, anyone can invest and work on a strategy to grow financially. From large names, to the average Joe, investing is good for the economy and for you. Just make sure you don’t make these lethal mistakes when you invest.
“First, You Find the Plan [and] Then You Find [the Investment] to Fit the Plan.”
When you first invest, you’ll find yourself making some silly mistakes that you’ll correct as you grow. That’s a lot different from avoiding due diligence altogether. If you are investing purely because it “looks like a good deal”, you’re planning to fail at investing.
This is why investors have an agenda, or a set of philosophies that drives their work. Are you providing for family? Growing assets with a specific purpose (like helping to grow green energy)? Figure that portion out first, then work on putting your money to work for those ideals.
“Rule Number One: Make Sure You’re Diversified”
Calculators can be a scary thing because they provide re-assurance we’re looking at a good deal. We look at potential profits, especially when a stock develops a track record of growth, and we see temptation. It’s fine to re-invest in a stock that’s performing. After all, you should try and get the best price for that stock over time. Just make sure you’re not ignoring other opportunities, and that your entire portfolio doesn’t rely on a single company’s performance.
“More Than Ever, You’ve Got to Train Investors to Think Against the Flows.”
Markets are cyclical, and this advice from Dev Randhawa highlights why it’s important to look at long term trends and dig deep prior to investing. Investing is tricky, and you’ve got to learn to resist impulses that tell you to sell or run. Investing has a very real fight or flight response you must work hard to overcome.