Five Bad Habits That Are Really Good while Investing
Not on Time – This is one of the most common bad habits. But this bad habit can do wonders to your equity portfolio. One thing that even Warren Buffett doesn’t do is to try to time the stock market. A majority of investors, however, do just the opposite, something that financial planners have always been warning them to avoid, and thus lose their hard-earned money in the process.
So, you should never try to time the market. In fact, nobody has ever done this successfully and consistently over multiple business or stock market cycles. Catching the tops and bottoms is a myth.
No News – Staying updated with the latest NEWS is a very good habit but this could help you lose money in the stock market. Breaking news tends you take wrong financial decisions.
There is a lot of information/news flowing around in newspapers, Social Media, TV, Internet. This information/news is so well decorated for you to take instant action. News tends you to forget fundamentals and emphasis recent events.
Staying away from such breaking news can help you stick to the fundamentals and grow money with the stock market.
Lazy Action – When it comes to investing, people often say that the more active you are, the wealthier you can become. However, it acts in reverse when it comes to investment in the Stock Market!
So, if you are too active with your portfolio, you are likely to get fewer returns! Shockingly, laziness will help you to get more returns! Yes, you read that right! Notably, investors should choose this for long term investment.
And what is more, market variations will not hurt your investment gains. Invest in good Stock/Fund and forget is the best strategy.
Being Unfaithful is really a bad habit but this bad habit can lead you to make more money while investing.
People usually hold a Stock/Fund/Lic because that is very old or is gifted by their Parents or Grand Parents.
Investors lose money and opportunity when are emotionally attached to some stock/financial product that is inherited and doesn’t sell them even it is not making money.
A good return paying Stock/Product/Strategy will not always give a return. Being unfaithful with your investment & exiting will open new opportunities.
Do Your Own – Following your friends/family/acquaintances is a good habit that can often lead to wrong financial decisions.
The typical buyer’s decision is usually heavily influenced by the actions of friends/family/acquaintances.
Thus, if everybody around is investing in a particular stock/fund/asset-class/product the tendency for potential investors is to do the same.
But this strategy is bound to backfire in the long run. Stop following the herd and use your brains to do your own.
Like it or not, bad habits are bad for you — mentally, physically, emotionally, and even financially.
While some bad habits listed above are extremely good for your financial portfolio and you need not get rid of them.