Investing money in the stock market is one of the smartest, wisest things you can do to help promote your future financial health. Too many Americans put their money in generic savings accounts because they truly don’t understand how to invest money in the markets. And once they start investing a little, they make all types of mistakes. At Check Issuing, we don’t tolerate mistakes. I’m kidding. I mean, kind of.
There are a lot of ways to avoid falling prey to investment traps. Often times, it just comes down to reading the right financial sources and trusting your gut. Here are a few solid tips that hopefully help you avoid investor mistakes that others have already made for you.
Trying To Outsmart The Market
The market will do as the market will do. It will have ebbs and flows. Financial markets are both finicky and cyclical. When an investor attempts to “guess where the market is going,” it often leads to one of two bad results:
- A bad share purchase
- A missed opportunity
If you see a stock that you feel is a good buy, for example, a share from a company that’s doing well, consider buying it at whatever price it is currently listed at. The bad road that many investors go down is that they see a great stock purchase and decide to “wait for it to drop in price” due to some “prediction” they’ve read. Often times, these predictions rarely come to fruition. And you end up wasting an opportunity at what may be a really solid investment.
No investor can predict the future. And anyone touting they can isn’t being sincere. Most of the time, these blogs that “predict” market fluctuations are simply trying to sell a service. If you love the new iPhone and all your friends share this sentiment, that may be all the information you need regarding Apple stocks. If your new iPhone is crap, well, again, all the information you may well need to determine the health of a company. I know it sounds super simple, and certainly, it isn’t that simple, but it is a great starting point to help you avoid falling for the “market predictions” trap.
If you buy a stock, you need to be able to sit patiently and allow the shares to mature. If you jump ship and sell at the first sign of a dipping price, you may lose out on future earnings. And if you buy and sell quickly too often, your portfolio will sit at a loss because you will constantly be selling shares that lost money. You need to hold the shares for a long period of time to garner true results. If you are buying stocks to earn a quick profit, you are playing a gambling game that you will likely end up losing in the future.
Additionally, most services apply a trading fee of $7 to $10 per trade. If you can’t help yourself from trading out stocks constantly, you might try using Robin Hood, a service which does not fee you up per trade (they do pop you for capital gains interest, however, so it isn’t a great option for long-term).
Stop Believing You Know It All
You will be wrong. You will make mistakes. But you will also win some and if you are patient and your overall stock portfolio reflects a mostly conservative position, you should always be winning. Often times, Wall Street day traders want us to believe that the stock market requires some sort of high-brow insight. But most of the time, it simply requires a common sense competency. If you mostly invest in big S&P stocks and ETFs and Mutual Funds, you should lower your risk and allow yourself some wiggle room to take on more high-risk positions. But buying or not buying a riskier position based on the feeling you aren’t an expert will only serve to hold you back.
No one is truly an expert. And if they are, that’s called insider trading, which is illegal. So law breaking approaches aside, read the traditional financial news, stay conservative in the core of your investment portfolio, and you should be just fine.
Avoid Scammy Advisors
The scams are everywhere. Don’t just let anyone take your money and invest it. Because in the end, they might well be investing in themselves. Only use the big, approved investment firms or your bank. Open a Vanguard account and learn the ropes yourself. If it sounds too good to be true, it is.
Investing your money into long-term stocks and ETFs is a perfect way to plan for retirement. The key is not being afraid or put off by what seems like an intimidating world.
from Check Writing, Document Printing and Mailing https://www.checkissuing.com/4-tips-for-avoiding-investor-mistakes/