Link to the video: https://youtu.be/T-8u6IuhMko
A large part of stock prices are driven by two emotions. They are greed and fear. Therefore a good investor should focus his mind and thoughts and not let emotions take over.
Lets talk about 3 worst mistakes beginner investors make when they first started. these mistakes are commonly found in beginner traders, however you can still find these traits in some of the advanced traders who has yet to master the basics of trading.
beginner mistake #1 Having too much stocks in your portfolio.
Having too much stocks in your portfolio is like a slow ticking time bomb for many new investors. Too much stocks will hinder how you consume and understand new information.
“As warren buffet always says, only invest in things that you understand”.
Do you really understand the 10 different companies that you sit in your portfolio currently? Well, You might understand some but mostly not really. Lets say if you do, can you explain what the company is about and how they are doing compared to their competitors?
beginner mistake #2 Not doing enough research
Many investors only care about their earnings, revenue and profit but dont really pay attention to whats really important. This could be fatal as many new investors think, green is good and red is bad. Things only move in certain direction because of a reason.
For example, Companies go up in value because they exceed their sales expectation or have breakthrough in innovation. But new investors only chase the bulls and bears and let their emotions blind them when it comes to picking the right stocks.
beginner mistake #3 Being driven by fear and greed (FOMO) The fear of missing out, FOMO is investors greatest enemy. When other investors share their stories on how they earn appealing returns with the recent stocks purchase, new investors would feel left out. The FOMO becomes more and more intense after the market value increases. Those remarks will make the new investors change direction by selling its underperforming stocks in order to buy assets that have recently experience significant growth and are likely to be expensive now.
More and more new investors now are more afraid of missing a bull market than suffering the large losses.
Conclusion
So Now you’ve understand the mistakes that the new investors make, it’s up to you to apply it to your investment strategy and watch your portfolio grow.
The most important thing is to remember your initial investment strategy and take a step back to reconsider your actions. You may have started with a strategy that provides with the best chance to achieve long term success, therefore changing direction now might not be that good after all.
Link to the video: https://youtu.be/T-8u6IuhMko
Submitted August 05, 2017 at 01:36AM by royalinvestment http://ift.tt/2fgXiaG
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