What have you learned, that you wish you knew, when you started investing in stocks?

What have you learned, that you wish you knew, when you started investing in stocks?

The below is my subjective personal experience and opinion. I do not think my experience is necessarily right or valuable for everyone.

For me:

Buying the broad indexes (e.g. MSCI World) is typically a good idea after a huge sell-off. It takes balls, and you might not hit the bottom, but it is often better to buy the dip than buy into a strong top formation. Many, not all!, losses can be averted, if you just forget about the investment, and let it sit for a few years. don't buy individual stocks. Buy well diversified funds, passive or actively managed. Broad diversification is good. Don't own stocks from just one single country or one sector. Gold miner stocks are to some extent a hedge, but this is a very dangerous investment. Those who bought gold exposure in august 2011 (when gold was expensive), are still in a huge loss today on that position. "safe" stocks like Pepsico and Hershey Co are not necessarily safe if they have high PE ratios and everyone have rushed to buy "safe" stocks in a low interest environment, where people see it as a low-risk alternative to getting 1% interest in their bank account. it is difficult to beat the market. When you manage to do it, it is often a result of luck, and not sheer analytical skill or technical trading talent. Avoid day trading. 

Submitted May 22, 2018 at 10:05AM by gorillaz0e https://ift.tt/2IBrmvI