Hi, straight to the point.
How do you avoid losing money when investing?
- Only invest based on pure rational logic and not emotion, emotional investing is the cause of many losses in investing.
2. Be patient, don’t sell a stock or investment because it has dropped for a week or even months to years- you don’t sell an investment because it is at a lower price on a certain day or month.
3. Always be patient in selecting your investment decision, you don’t have to say yes to every investment that looks good- being patient in waiting until the right investment presents itself is essential to investing success.
4. Invest and don’t speculate, you either know or you don’t know- there is no in-between in investing.
5. Stay in your field of expertise, invest in what you know and only that- you just have to be smart in a few places to succeed in investing.
6. Identify when the market has over reacted to news or an external medium influencing the price of an investment, this opens up doors for value investors to step in.
7. Always seek to improve and grow, you never know it all when it comes to investing- be a constant student in learning and growing.
8. Don’t try to beat the market, instead- attempt to avoid falling for the common mistakes investors make.
9. Keep your investment approach as simple as possible, investing is not complicated- it’s simply a game of patience and having the gut to hold investments for the long run.
10. Don’t invest, unless you would be comfortable holding the investment for a minimum of 10 years- you can never know what the markets are doing in the short term, it is easier to anticipate the markets in the long run.
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Thank you for reading and have a fantastic week ahead.